dmertz
Level 15

Retirement tax questions

Since these were all personal contributions, if you ignore the fact that you had more contribution returned than  actually permitted, you can get the correct result by just entering the net contribution instead of the actual contribution.  TurboTax will then not indicate any excess contribution that needed to be returned and your Form 8889 will show on lines 2 and 13 only the net amount contributed.  You'll still need to enter the code-2 From 1099-SA to include in income the amount shown in box 2a.

 

If you choose to not ignore the fact that more than permitted was returned, you would need to enter a code-2 Form 1099-SA reflecting what the amount returned should have been, enter a code-1 Form 1099-SA for the  the remainder (which could be applied to qualified medical expenses), then provide explanation with your printed and mailed tax return as to why your tax return does not reflect what is shown on the Form 1099-SA.  (The HSA custodian is not going to change the original Form 1099-SA since they did what you told them to do.)

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