In 2020 my husband became eligible for a HDHP and an HSA account. He started in July, so we invested the maximum we could that year for a family. When we did that we didn't realize that his company would also contribute a lump sum ($1,846), so the lump sum became an excess contribution. I paid the taxes on the excess several years in a row, and in December 2023 I had it and the interest earnings removed through his HSA custodian. For filing taxes, I input the 1099-SA with the distribution and earnings and marked the distribution code 2, and also included the other qualified medical distributions in a separate 1099-SA. Turbo Tax then asks for excess contributions from 2022. I enter in the $1846 from the prior year. Turbo Tax is telling me I still having me pay the 6% taxes on the excess. Is this correct? Is it still considered an excess, or am I paying the taxes on the distribution? I filled out the form by hand, but I can't review the form in Turbo Tax until I pay, and I want to make sure it's correct first.
