How to account for being covered by an HDHP + a non-HDHP PPO in the year 2024, where my employer made HSA contributions?

[taxes_are_hard1]

In 2024, I was covered by an HDHP through my employer and by a PPO through a family member. In 2023 I had the same situation and needed to get a refund for my HSA contribution. TurboTax explicitly asked me whether I had dual coverage, told me I couldn't have tax-free HSA contributions since I was covered by a PPO as well, and prompted me to either pay excess tax (6%) or get a refund of excess contributions. I chose the latter, and the amount that had been contributed to my HSA was instead indicated on my tax return as additional income from Schedule 1, and I paid taxes on it like regular income. I had still been enrolled in the same HDHP in 2024 and already received the 2024 contribution from my employer since I didn't know that I couldn't receive it until I did my 2023 taxes in 2024. Now, however, I'm not being given the same option to correct my situation as I try to file my 2024 taxes; the HSA contribution is still being accounted for as tax-free. I know I'm not eligible to have tax-free contributions. How can I adjust this in TurboTax?

[BillM223]

In the HSA interview, when it asks you if you had HDHP coverage in 2024, you should answer "No". So long as you answer Yes, TurboTax will allow your HSA contributions. This is because there is no explicit question asking if you have other conflicting health insurance coverage. Just answer that you had no HDHP coverage.

"TurboTax explicitly asked me whether I had dual coverage," The input in TurboTax does not ask you this; instead, we in the Community would tell you this in your situation (perhaps that is what you are remembering).

The description of what happened on your 2023 return sounds to be exactly what should have happened. And you are right to wonder why it didn't happen again - go back into the HSA interview and state when asked that your HDHP coverage in 2024 was NONE.

[taxes_are_hard1]

Thank you for the instructions. I do very explicitly remember having TurboTax indicate in the instructions that I should not put that I have HDHP coverage in the event that I also have PPO coverage, but there is no such instruction this time. I'll follow the steps as you've described, but I would please request that the instructions and/or questions be updated to account for that case, since based on the guidance given, I was prompted to make a different selection, and anyone who didn't already know that the instructions were wrong would end up filing incorrectly. I am specifically referring to the "How do I know if I'm enrolled in an HDHP?" help section.

[taxes_are_hard1]

Thank you for the instructions. I do very explicitly remember when filling out my 2023 taxes having TurboTax indicate in the instructions that I should not put that I have HDHP coverage in the event that I also have PPO coverage, but there is no such instruction this time. I'll follow the steps as you've described, but I would please request that the instructions and/or questions be updated to account for that case, since based on the guidance given, I was prompted to make a different selection, and anyone who didn't already know that the instructions were wrong would end up filing incorrectly. I am specifically referring to the "How do I know if I'm enrolled in an HDHP?" help section.

[BillM223]

I do not recall any such instructions that you describe, but if you can remember where you saw them, I would ask that they be reinstated.

By the way, are you using the Online product or the CD/download product?