My parents are claiming me as a dependent so I filed a return of excess for HSA.

[e_pino20]

 For the state portion (Pennsylvania)I was wondering if I check off the “distributions from MSAs or HSAs included in federal taxable income” or do I check none of these since I will be getting the return of excess? The screen is referenced below. 

Tell Us About Any Distributions
Select any items below that you reported on your federal return:

Distributions from Life Insurance, Annuity, or Endowment Contracts
Distributions from Charitable Gift Annuities

Distributions from MSAs or HSAs included in federal taxable income
Early Withdrawal Penalty

None of these apply
 

[BMcCalpin · Accepted solution]

I still do not find this screen in the PA interview; however, I have found a screen that asks for similar information.

Basically, if you had excess contributions, the excess is added back to Other Income on line 21, Schedule 1 (Form 1040) on the federal return.

Since the PA return does not start with federal adjusted gross income (as many states do), the PA-40 asks for all the individual income items that apply to PA, which, of course, this would be one of them.

This "distribution" is taxable in PA because the contributions to the HSA were tax-exempt.

So, yes, check off that you are getting a distribution from an HSA which is included in federal income (since you really have). You may see as you progress that TurboTax has automatically filled the screen in with the amount of the excess - this is what it did on my test with different screens but of similar intent.

If the amount filled in is the same as your excess, then just continue. If it is not, then enter your excess amount and continue.