How do i answer line 1 on form 8889 when i did not have a high deductible health plan but contributed to an HSA in error?

[BMcCalpin · Accepted solution]

Are you in the federal review? And TurboTax is demanding that you answer line 1 as Self or Family?

Since you did not have HDHP coverage but still want to e-file, please do the following:

• Check "Self" for your coverage on Line 1. No, you did not have Self coverage, but the 8889 will correctly say that you had no coverage in any month, which is more important.
• Also, scroll down and check "None" for each month on the Line 3 Smart Worksheet (if it is not already done).
• Also, scroll down and check "None" for each month on the Line 18 Smart Worksheet (if it is not already done).

If you don't check these boxes on lines 3 and 18 on the first pass of the review, the review will just come back to them anyway - might as well do them all once.

This will cause all of your contributions to be considered as excess. The entire excess will be added automatically to Other Income (line 8 on Schedule 1 (Form 1040)). Withdraw as much as you can. Anything you can't withdraw will be carried over to next year and penalized the lesser of 6% or the value of your HSA on 12/31/2019.

[Edited 3/26/2020 11:54 am CDT - updated for 2019]