2017 I had excess HSA contribution. 2019 I W/D the excess. Do I need to indicate that on my 2019 form? If so where?

[indflyr]

I paid the tax penalty and extra tax each before I found out that I needed to W/D it from the HSA.

[BillM223]

The due date to withdraw the excess for tax year 2017 was April 15, 2018.

If you withdraw the excess after that, then this is what happens:

1. You receive a 1099-SA which reports the excess.

2. You enter this into TurboTax - note that you have to say that you have an HSA even if you don't any more, in order to see the 1099-SA interview.

3. The amount of the excess will be reported on line 8 Schedule 1 (1040) as income in 2019.

4. An additional penalty of 20% on the excess will be assessed. It will be reported on line 17b of form 8889, and also on line 8 Schedule 2 (1040) as an additional tax.

Note that this 1099-SA will be in addition to any normal 1099-SA that you receive for normal medical expenses.

[dmertz]

Also, since this must be a normal distribution reported with code 1 on the 2019 Form 1099-SA to be able to resolve the 2017 excess, you must indicate that the amount of the excess was not used for qualified medical expense to cause it to appear on line 8 of Schedule 1, otherwise the distribution does not resolve the excess in your HSA.

Both the distribution of the excess and any distributions used for medical expenses will be combined on a single Form 1099-SA.  As far as the HSA custodian is concerned, these are all normal distributions.