I have an HSA account that is Employer contribution only of $1500 annually. I do not have an HDHP, it's a PPO. It says my HSA was overfunded, which is not correct.

[shane-davisson]

Per my W-2 on line 12 it's a employer HSA contribution for $1500.  That's the only contribution that was made in 2017.  That was the only amount desposited to the HSA.  It's stating that I may have overfunded / had excess contributions in 2016/previous year.  In 2016 it was also only $1500 in employer contributions as well.  I checked my 2016 tax form and there was no 5329 form or amount on line 48.  When I clicked no I did not overfund my HSA in 2016 it says I may want to withdraw money from your HSA and that I have an excess of $1,500.  This amount is being taxed an extra 6%.  My balance in the HSA currently is only around $200 and there is no way the account was overfunded.  I have a Family Health Care Plan.

[AnnetteB]

Information on your W-2 (code W in Box 12) indicates that money was contributed to a Health Savings Account (HSA) for 2017.  You must have High Deductible Health Plan (HDHP) coverage in order to be eligible to contribute to an HSA.

You should discuss this with your employer to be sure it was not reported in error or to be sure that your health plan is not a HDHP.  If it is a HDHP, then you need to go back through your return to change your answers.

As you went through the section of your return to verify your eligibility to contribute to the HSA, since you indicated no HDHP coverage during the year, the entire amount that was contributed is considered to be an excess contribution. 

Take a look at the following information to read more about HDHP and HSA requirements.

https://ttlc.intuit.com/replies/3300505

https://ttlc.intuit.com/replies/4787500