Self Excess HSA contribution

[james1110]

I funded my HSA to the limit for 2022 ($4650) in early 2022.  A few months later I realized that my health care plan was not an HSA anymore.  I contacted my HSA adminstrator right away and had the funds removed.  I have since received a 1099SA showing the distribution of these funds and a code of 2.  Do I need to report this transaction on my tax return since it was just basically a wash?  I cant figure out how to do this in Turbotax.

Thanks.

[ThomasM125]

You should list the form 1099-SA on your tax return. The IRS will get a copy of it and look for it on your return. If there were any earnings listed in box 2 you will need to include that in your taxable income. Otherwise, the return of contributions will not result in additional tax on your return. You enter the Form 1099-SA in the Deductions and Credits section of TurboTax, and then Medical, then the 1099-SA, HSA, MSA section.

[james1110]

Do I also need to report the original contribution I made in error?

[JohnW152]

Yes, you do.  Make sure you enter it correctly, though.

In TurboTax Online:

1. If you don’t see 2022 TAXES in the left pane, select the dropdown to the right of Income & Expenses on the Hi, let’s keep working on your taxes! page and then select Let’s get started, Pick up where you left off, or Review/Edit. 
   • Otherwise, in the left pane, select Federal, then Wages & Income (This is labelled Income & Expenses in TurboTax Self-Employed)
2. Scroll down and select the Show more dropdown to the right of Less Common Income
3. Select  Start or Revisit to the right of 1099-SA, HSA, MSA
4. On the  Tell us about the health-related accounts you had in 2022 page, select Health Savings Account (HSA).  You presumably still have an HSA  account, even though you're no longer covered by an HDHP
5. Select  Yes on the Did [you] put money into an HSA in 2022? page 
6. On the  Let's enter [your] HSA contributions page, enter the contributions you personally made, and the contributions you withdrew before April 18, 2023 
7. Continue through the screens

[Edited 3/15/2023 | 7:09 am CST]