Medicare Overpayment Refund

[harperlady]

Medicare premium overpayment refund (originally self-paid from HSA) was included on SSA-1099 Net Benefits. The refund was deposited back into the HSA account so the refund should not be tax deductible. How do I reflect this in TurboTax?

[BillM223]

So the only form you received about this was the SSA-1099? And you entered this refund as part of the SSA-1099?

Please contact your HSA custodian and tell them what happened.

1. Ask them if they received the refund into the HSA.

2. If so, ask them not to treat it as a contribution. Be very nice and grovel if you need to because HSA custodians are notoriously reluctant to fix errors - even their own.

3. Was the refund included in your SSA-1099? I am not clear on what actually happened.

4. Did TurboTax include this as a contribution? If so, how?

[harperlady]

Yes, the only form I rec'd about the refund is the SSA-1099.  They included the refund in box 3 (Benefits Paid in 2024) and box 5 (net benefits for 2024) with an * that says "Includes $673.20 paid in 2024 for 2023).  The $673.20 is the Medicare Part B refund.  I sent the refund check to the HSA with specific "withdrawal correction form".  The funds were deposited back into the HSA account and was not treated as an additional deposit. 

I rec'd form 5498-SA from the HSA that has zero deposits for 2024 and reflects only the fair market value.   

What happened is that I prepaid Medicare Part B premium in the year 2023 for part of the 2024 year to exhaust the HSA.  Unfortunately, Medicare rep advised me incorrectly that I could pre-pay.  I was self-paying Medicare Part B premium for a couple years until I started receiving Social Security Benefits in 2024.  The refund is including with Social Security Benefits received in 2024 in Boxes 3 & 5 on the SSA-1099 form. 

I rec'd the following response in TurboTax help.

"The SSA-1099 reports your Social Security benefits, including any amount withheld for Medicare Premiums.  If you received a refund for a Medicare Part B premium that was originally paid from your HSA, you generally do not need to include that refund in your taxable income.  In TurboTax, you can enter your SSA-1099 information, and when prompted about any adjustments or refunds related to your Medicare premiums, you can clarify that this amount should not be included in your taxable income.  This will help ensure your return accurately reflect your income and any adjustments."

The problem is that I'm not being prompted about any adjustments or refunds related to Medicare premiums.

Thank you for your time!

[BillM223]

"I rec'd the following response in TurboTax help."

Can you post the URL where you found this response? I am trying to find the context of what you are doing.