That might be because you over-funded the plan. You are only allowed to contribute $3,500 per year ($4,500 if over 55) to an single HSA plan. If you contribute more, you are subject to a penalty. You could withdraw the excess contribution by the due date of your tax return to avoid the penalty however.
Sorry for the delay Thomas, I had not seen that you answered the question. I don't think that is it. I put less than $3000 into the account last year.
Double check your entries. It is possible you entered the HSA contribution more than once, and it is considered an excess contribution.
The most common error I see when entering HSA contributions are double reporting. Typically, these payroll contributions are reported on your W-2 in box 12 with code W. If that is the case, no other contribution needs to be reported in the software.
Under the Deductions & Credits menu, confirm the following:
Also, verify that you indicated that you participated in an HDHP. If not, the contribution will be "disallowed" and taxable as an excess contribution.
Thank you GloriaD75. That is what I did. I went in and tried again and still no luck. When I originally entered the information it dropped my refund when I got to the point where I marked that I DID participate in a HDHP all year, that is what I thought was so odd.
As an experiment I just made the selection for "no, I did not have coverage" and the refund shot back up. I must still be doing something wrong.
This may be a silly question, but are you sure you are seeing a change in a refund and not a change in a balance due? The situation you described is opposite of what would normally be expected.