HSA excess contribution- who is responsible for calculating the interest?

[jenn-lan]

My understanding is the HSA fund will calculates the interest earned on the excess contribution when I request it and put it on the 1099-SA? I contacted my HSA fund last week to verify and they are taking now over a week to verify if this is truly the case.  I'm assuming this is not the first time they had a customer with an over contribution...?

[BillM223]

Yes, the HSA custodian is responsible for calculating the earnings on excess contributions (in reality, you have no practical way to do it).

But as I said in the other reply to dmax182, if you withdraw the excess contribution before the due date of the return, then because the earnings were made in two years (2019 and 2020), the IRS permits the HSA custodian to wait until early 2021 to issue the 1099-SA and report the earnings then.

Yes, this means that you are likely to get two 1099-SAs in 2021: one for the excess contributions withdrawal and one for your regular medical spending.

The custodian is probably not in a hurry because they have until next January to send you the form.