TurboTax is incorrectly seeing that my wife "had a break in HDHP health plan coverage during 2023." But that's not true. How do I correct this?

[BillM223 · Accepted solution]

You have seen the question: "What type of High Deductible Health Plan did [name] have on December 1, 2022?" TurboTax is looking to see if your spouse used the "last-month rule" in 2022. The "last-month rule" allows you to use the maximum HSA contribution limit if you had HDHP coverage on December 1st of the tax year. But it requires that you maintain HDHP coverage for the next year (or else, the lapse).

When you answered Self or Family for your wife, you got the message that there was a lapse in HDHP coverage, when in most cases, there wasn't.

Rather than explain the "last-month rule" and its vagaries, just do this:

• If your spouse had HDHP coverage for every month in 2022, answer "None" when asked the question above.
• If your spouse did not have an HSA at all in 2022 (i.e., it was yours), then answer "None".
• If your spouse had an HSA in 2022 but never contributed to it in 2022, then answer "None".

Answering "Self" or "Family" just confuses TurboTax (for reasons I don't want to explain), so answering "None" in the cases above will get you the outcome that you want, and let you continue in the interview.

This seems counterintuitive, but it's better than explaining the "last-month rule" and asking if it applies to your spouse.

[lindr04]

Thanks for your explanation, Bill!  I do have a HDHP on family coverage under my name - for quite a few years now with zero lapse for anyone.  You're sure right when you say that it's counterintuitive that I should say "none" in order to get the desired result.

Of course I rely on Turbo Tax to take the complexity out by letting me answer questions, and let the system (and the experts behind the system) understand the details.  It's funny to me that I'd essentially have to lie to Turbo Tax in this case, so I hope that one of those experts behind the system maybe sees this and perhaps adjusts the interview questions and/or logic.

Thanks again for your reply, Bill!  I haven't tried it yet, but this looks like it will allow me to continue working through my taxes now!  I appreciate your time!

[Anonymous]

Thanks, @lindr04 , for posing this question! I had the same problem too. And thank you, @BillM223 for explaining how to obtain the desired result!

I also expect the experts programming turbotax to fill in the forms using simple, objective questions to remove the confusion behind filing taxes. This section needs to be updated to make it easier for users to understand.

[bobmcc6]

Thanks for this work-around!