Did XXX High Deductible Health Plan coverage lapse in 2019 due to disability?

[mollyjsto]

On this screen it tells me that I've had a break in my HDHP coverage during the year and asking why it ended (due to disability or for another reason). The answer is that it didn't end (Covered all 12 mos. is checked on my 1095-C), but there is no option for that answer. 

I did NOT have a break in my coverage and my husband and I are on two separate SELF ONLY plans. There is no way for me to get around this question without lying??? 

I have found MANY other users on this forum with this exact same question that get the exact same answer. The answer that's given (https://ttlc.intuit.com/replies/6480142) is answering a completely different question. My husband has an HSA through his employer, and I do not. Both my husband and I are on our own individual only health care plans through our employers as well. Neither one of us had a lapse. 

[JulieS]

I just went through the HSA section under Income & Expenses and I found that I was asked the same question prior to being asked about coverage.

If you answer that question, No, a few screens later you will get a screen that allows you to indicate your plan for each month.

There is also an HSA section under Deductions & Credits. If you go through that one, it asks about the entire year in one question. 

It is awkward, but if you answer the HSA questions in the Deductions & Credits tab, it makes more sense.

[coloradojoe]

I have the same problem as the original poster. However, after selecting "No, the coverage ended for other reasons," contrary to what you've described, I do NOT get the ability to indicate months when my spouse had coverage.

Seems more and more like this issue should be filed under "Bugs that TurboTax needs to fix."

[BillM223]

"Did XXX High Deductible Health Plan coverage lapse in 2019 due to disability?:"

It's likely that you should not have even gotten this far.

This is what is happening:

There is a question, "What type of High Deductible Health Plan did Blank have on December 1, 2018" (yes, 2018 is correct). The question is attempting to find out if the taxpayer had HDHP coverage in 2018 and contributed to an HSA, but did not have HDHP coverage in 2019.

The problem is that for any taxpayer who never had an HSA, this question does not apply to them, so they should answer, "NONE".

The same is true for a taxpayer who never had any HDHP coverage - they should answer, "NONE".

In fact, if you did not have HDHP coverage in 2018 or you did not contribute to an HSA in 2018, you should just answer "NONE".

The problem comes in when taxpayers answer this question with Family or Self, not knowing it doesn't apply to them.

[mkbnj]

This logic is right, but missing the situation where (1) I did have HDHP in 2018 and (2) I did have HSA in 2018. It still forces me to choose between two things that are not true (disabled, health plan terminated). Seems to be a bug. What are the effects? How should I answer?

[BillM223]

@mollyjstocoverage.

This question is trying to determine if you utilized the "last-month" rule in 2018. The last-month rule lets you use the full annual HSA contribution limit if you had HDHP coverage on December 1, 2019, even if you were not covered by an HDHP for all of 2019.

Using the "last-month" rule requires that you stay under HDHP coverage for all of the following year (2019)

This question applies only to taxpayers who had HDHP coverage in 2018 and who made HSA contributions to their own HSA in 2018; otherwise, they could not have benefited from the last-month rule.

In your case, I believe that only your husdband has an HSA, right? TurboTax sees from the HSA interview that your husband had HDHP coverage for all of 2019 (because he said so in his part of the HSA interview), but TurboTax never had the chance to ask you about your HDHP coverage in 2019, because you do not have an HSA so you were never asked about HDHP coverage in 2019.

When you answered truthfully that you had either Family or Single coverage on December 1, 2018, because you had not indicated in the HSA interview that you had HDHP coverage in 2019 (because you were never asked), the program wrongly assumed that your coverage in 2018 had lapsed in 2019.

So, the fix is this: go back to the question (at the end of the HSA interview), and if you did not have an HSA in 2018, then answer NONE.

I know that that is not what the questions asks, but believe me, the question does not apply to taxpayers who don't have an HSA, even if they have HDHP.

@mkbnj

The question precisely targets taxpayers who had HDHP coverage on December 1, 2018 and who made HSA contributions to their own HSA in 2018. 

Unfortunately, the question does not clarify that it it for a small group of taxpayers and that all other taxpayers should answer "NONE".

So, when you see the question "What type of High Deductibel Health Plan (HDHP) did [name] have on December 1, 2018?" please see the following:

If you had HDHP coverage for all of 2018 , then enter NONE 

If you had no HDHP coverage for all of 2018, then enter NONE.

If you did not have an HSA in 2018, then enter NONE.

If you had an HSA in 2018 but did not contribute to it in 2018, then enter NONE.

Remember that HSAs belong to the individual; spouses don't share an HSA. Thus, if you two use the HSA of one spouse or the other, the spouse who doesn't have the HSA never tells TurboTax that he/she had HDHP coverage in 2019, so if prompted by this question. If one of the four situations above applies to you, just answer NONE.

[michstanifer]

This answer makes no sense to me.  My husband has HDHP w/HSA.  I am covered under his family plan.  I answer correctly and still am asked about my lapsed coverage.  I have been using TT my whole life and have had this same insurance for 12 years.  I have never encountered this problem before and can't seem to get around it.  

[BillM223]

@michstanifer

As I noted above, the issue is that TurboTax is asking whether or not you used the last-month rule in 2018. The last-month rule allows you to use the full annual HSA contribution limit even if you weren't under HDHP coverage all year.

This screen used to ask if you used the last-month rule. Of course no one knew what that was. So this question was replaced by the seemingly innocuous, "What type of HDHP coverage did you have on December 1, 2018?" Anyone would know that, right, even if they didn't know what the last-month rule was.

If you answered "Family" or "Self", then TurboTax knew that you had coverage in 2018, and compared this to the HDHP coverage that you had for 2019. Unfortunately, the way that the HSA interview's flow runs, if you personally don't have an HSA (your husband does), TurboTax never asked you if you had HDHP coverage in 2019, so TurboTax mistakenly thinks that your coverage lapsed.

This is just the result of TurboTax correcting a poorly-worded question from 3 years ago with another question that could have been worded better.

In your case, since you probably did not have your own HSA in 2018 and therefore could not have used the last-month rule, please answer "None" when you see this December 1, 2018 question. The question does not apply to you, but only to your husband.

[michstanifer]

Thank you for clarifying however that isn't exactly how the question flow runs. It first asks about William, my husband, and then it asks about me specifically, by name. If I answer that I had coverage I have a problem.  I had to say I had no coverage.  TT needs to fix this.

[Jenwa]

I had the exact same problem, I am under my husbands HDHP and have my own HSA.   To fix the problem, I selected the Wage and Income section and then went to the Less Common Income HSA update.   From there I proceeded to the HSA summary and picked edit to get to the next screen. I found that my box for the Health Savings Account was unchecked (because I didn't use any or add any money in 2019 from my HSA account).  I checked this box and it fixed the problem.  I did have to indicate I had distributions of zero on later screens.

[BillM223]

@michstanifer

This poorly-worded question is the result of trying to fix a previously poorly-worded question. The question does not even apply to a large number of taxpayers (like you who has no personal HSA), but you are not told that.

@Jenwa

I assume that there is a form 8889 in your name on your return? (note that each spouse with an HSA gets one).

You are correct that of you did make any contributions to or take distributions from the HSA, then you should not have to report your HSA activity on the 8889.

When you said that you, too had an HSA, then you went through the part of the HSA interview in which you indicated that you had HDHP coverage for the year. This is what fixed your "problem" because TurboTax decided that there was no lapse since you showed coverage in both 2019 and 2018.

However, the problem appears for those taxpayers who don;t have a personal HSA. They are never asked if they have coverage in 2019, so when they answer "Family" or "Self" that the December 1, 2018 question, TurboTax mistakenly thinks that their coverage lapsed when it didn't.

Well, all's well that ends well... 

[Flyfisher1]

This question was also on the 2018 version.  Why in the world doesn't someone at Intuit fix this question so that it makes sense???  Would it really be that difficult to use the language that you used in your answer?  Tax time is stressful enough without having to play guessing games with inaccurate/incomplete questions.

[TepinJ]

It's a bug in my opinion. There was no lapse for my spouse filing jointly. My guess is that there isn't really an option for a "family" HSA (originating from a single source or employer).

[DaveF1006]

i think we might be trying to mix lemons with pomegranates here. let's see if we can answer the questions to clear up any misconceptions.

1. Let's go to federal>income and expenses
2. less common income>1099-SA, HSA, MSA>start or revisit
3. First screen asks tell us about the health-related accounts you had in 2019 check both of your names for HSA
4. You can answer yes or no for the next question
5. Now it will say Now let's work on XXX HSA
6. then just follow the screens and answer accordingly and continue until it asks you if you have a high Deductible plan. You will say yes to this question if you were covered for at least one month.  Then there will be a drop down that will give you the  opportunity to state that you were covered by a self-only plan for the entire year.
7. Next screen will give you the opportunity to answer the same questions for the spouse. Check all the answers make sure that these are answered correctly.

[Brian49]

I was having the same problem as many of the people above on Friday (April 10), but now when I enter my HSA information, this question is not even asked during the HSA interview.  Did something change?

To be more precise, I have an HSA and my wife does not.  On Friday 4/10/20 entering this information caused Turbotax to ask "what type of HDHP coverage did you have on December 1, 2018" about my wife during the HSA interview.  Today (4/12/20) I have the same information entered, but when I complete the HSA interview this question is never asked. Did something change?