When you go through the HSA interview (Deductions & Credits->Medical->1099-SA, MSA, HSA, or similar wording - it varies slightly between the products), you will be asked If You Had Medicare at any time in 2023?
Answer YES, and then you will asked what coverage you have for each month.
TurboTax will use this information to calculate your annual HSA contribution limit, and will apply the contributions found in box 12 with a code of W on your W-2 plus any personal contributions you made.
TurboTax will tell you that you made excess contributions (I presume). Then it will automatically add any code W amount in excess back to Other Income.
TurboTax will also ask you how much of the excess you will withdraw. Whether you have already withdrawn it, or intend to, say yes. NOTE that the calculated excess may not be the same as what you think it is. Don't worry, it is difficult for taxpayers to calculate the excess correctly, so just go with TurboTax.
The process is largely automatic on TurboTax's part, so please don't try to help. Just acknowledge the excess that TurboTax calculates, and finish the withdrawals. Please tell the HSA custodian that these are withdrawals for "excess contributions". This is important so that their paperwork will be correct.
Any more questions? Then come on back!
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