I have a HSA through my employer but when filling out my return it then asks me if I was covered by a hdhp in which the options are yes I was covered or no I wasn’t covered . It also says that if

[JotikaT2]

You must have a high deductible health plan (HDHP) to open a Health Savings Account (HSA).  If you do not, you will receive warning messages as you enter information in the return.

Review your input for your HSA contributions and distributions.

In order to do this, go to the Federal section of the program and select "Deductions & Credits".

1. Select Medical (you may have to select see all if you do not see this option)
2. Under Medical, select "HSA, MSA Contributions"
3. Follow the screens and answer the questions 
4. Enter any information from any 1099-SA forms.  
5. Confirm whether the distributions were used on medical expenses.
6. Confirm if you or your spouse were covered under a "High Deductible Health Plan" (HDHP).  If you answer no here, the program may result in a lapse of coverage warning, so please verify your answer here to avoid the error.

I have attached a link to additional information regarding HSA's.

HSA contributions

[sealpodmama]

Thanks for your post!

We had an HDHP when we started contributing to our HSA, but last year, we chose a different insurance option.  We made no further contributions, but we did take distributions from the HSA for medical expenses.  Turbotax filled out Form 8889-T for me with 2018 HSA numbers in "Line 18 Smart Worksheet."  I assume this is to show that we were eligible for the HSA.  Part C in that worksheet asks for the total maximum contribution allowed for 2018.  Turbotax left that blank, but I know the max contribution allowed that year was $6900. 

I am not sure if Turbotax thinks we have a lapse in coverage - it did not like me saying we have an HSA but NOT an HDHP!  Do you have any advice?

[VictoriaD75]

You can still own an HSA (funded from prior years) if you are no longer HSA-eligible. You can still withdraw the money tax-free if the funds are used for qualified medical expenses. If you only have qualified withdrawals for the year, you only need to enter the information from Form 1099-SA. Be sure to indicate that you did not make contributions. Your W2 would have code W in box 12 for any employment-related contributions.

However, you cannot make additional contributions to an HSA without an HDHP. 

Qualifying for an HSA

To be an eligible individual and qualify for an HSA, you must meet the following requirements.

• You are covered under a high deductible health plan (HDHP), described later, on the first day of the month.

• You have no other health coverage except what is permitted under Other health coverage , later.

• You aren’t enrolled in Medicare.

• You can’t be claimed as a dependent on someone else’s 2018 tax return.

If you do not meet these qualifications, your contributions are disallowed and treated as excess contributions. 

Excess contributions.

You will have excess contributions if the contributions to your HSA for the year are greater than the limits discussed earlier. Excess contributions aren’t deductible. Excess contributions made by your employer are included in your gross income. If the excess contribution isn’t included in box 1 of Form W-2, you must report the excess as "Other income" on your tax return.

Generally, you must pay a 6% excise tax on excess contributions. See Form 5329, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, to figure the excise tax. The excise tax applies to each tax year the excess contribution remains in the account.

You may withdraw some or all of the excess contributions and avoid paying the excise tax on the amount withdrawn if you meet the following conditions.

• You withdraw the excess contributions by the due date, including extensions, of your tax return for the year the contributions were made.

• You withdraw any income earned on the withdrawn contributions and include the earnings in "Other income" on your tax return for the year you withdraw the contributions and earnings.

Publication 969

Form 8889

[brl88c73]

I do not have a high deductable medical coverage but my company allowed me to open a HSA which at the time I was unfamiliar with the rule. I now cannot complete my taxes because turbo tax is asking each month if I had individual or family coverage under a high deductable plan and I do not want to provide misleading info. I show $90 in box 12 and approximately $350 in distributions. What can I do to correct this and be in compliance but more importantly complete my federal taxes.?

[ZoltanB45]

You would not enter it in if you did not have a High Deductible Health Plan. The taxable income on the w2 was reduced by the amount contributed to the HSA.  That is how you benefitted from the plan.

[brl88c73]

I am unable to submit my final federal and state taxes. Turbo tax continues to bring me back to the smart sheets regarding my HSA account asking if I had a high deductible coverage plan for individual, family or none (if on Medicare). Each time I attempt to push it through it brings me back and won’t file taxes. What do I do?

[FangxiaL]

If you made contributions to your HSA account ($90 in Box 12 with code W), select yes to the HDHP plan (you must have one to have an HSA account).  

@brl88c73