We had an HSA Excess Contribution for 2018. We have withdrawn the overage and interest. How do we complete the TurboTax 1099-SA form without a corrected 1099-SA?

[BMcCalpin · Accepted solution]

If you withdrew the excess after January 1, then the HSA administrator may or may not send you a corrected 1099-SA. You will get for next year a 1099-SA with a distribution code of '2' to describe the amount of earnings on the excess while it was in the HSA; since this is taxable in 2019, you will probably get it in early 2020. This will be in addition to your regular 1099-SA reporting normal distributions in 2019.

The excess contribution is automatically added back to your tax return as Other Income on line 21 (Form 1040). Thus, your tax return will have the correct income even if you don't get a corrected 1099-SA this year.

As for the 1099-SA, it reports on distributions, not contributions. It is your 5498-SA that reports contributions that will get updated. But normally you don't enter information from the 5498-SA into TurboTax (it is not even required to be sent to you until the end of May).

So, call your HSA custodian and ask them if they will issue a corrected 1099-SA. If they won't, just go ahead and file your return; your return will be correct in terms of tax due. Keep a record of what has happened in your tax files, in the somewhat unlikely case the IRS ever writes you a letter about why the distributions on your 8889 don't exactly match the HSA custodian's records for 2018.