In 2015, I funded my HSA with a direct transfer of funds from my IRA. My IRA company provided Form 1099-R with a Distribution Code of 01 - Early distribution, no known exception (in most cases, under age 59.5). The IRS says I owe taxes, plus a 10% penalty on the distribution. I asked my IRA company to fix this by providing a corrected Form 1099-R with a Distribution Code of 02 - Early distribution, exception applies (under age 59.5), by the IRA company refused.
The proper code in box 7 of Form 1099-R for this is code 1 because the IRA custodian has no way to know if you qualify for an HSA contribution or not.
Provided that the entire distribution was a qualified HSA Funding Distribution (HFD), this distribution is not reportable on Form 5329 at all because none of it is taxable. All that is necessary is that the HFD was included on Form 1040 line 15a or Form 1040A line 11a, excluded from line 15b or 11b, and that the notation "HFD" is included next to the line. TurboTax does all of this automatically when you enter the Form 1099-R and you indicate the amount that what transferred to an HSA.
The HFD should also have been present on line 10 of your Form 8889.
If everything was reported correctly, all you should need to do is point that out to the IRS and to point out to the IRS that your 2015 Form 5498-SA from the HSA shows the contribution included in box 2.