I Was on Medicaid for a couple months then got a job that has Medical Insurance and I opted to start an HSA with automatic payroll deduction. Turbo Tax says I am not allowed to do this and need to withdraw the money, or pay additional 6% on it.
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If you signed up for a High Deductible Health Plan (HDHP) with your employer, which allows you to open a Health Savings Account, and you confirmed with your employer that you did not over contribute, go through the entire HSA section until the end. Please see Why am I showing an excess HSA contribution in 2021?
The program asks if you were covered by an HDHP, and also asks if you were covered by Medicaid or Medicare. When you answer yes, the program should give you a list of months, with a box to check for each month saying you were covered by Self HDHP, Family HDHP, or something else. Make sure you filled out this chart correctly, using your status as of the first day of each month. You should be eligible to make HSA contributions for any month that you were covered by the HDHP and not Medicaid (any month you were covered by both, you are not eligible).
(You are eligible if you are covered by an HDHP AND not covered by anything else.)
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