If I withdraw my excess HSA contribution what do i report it under?

[sanjeev40084]

I have excess contribution on my HSA account for the previous year. I am planning to take the whole excess amount out by contacting my HSA administrator. From my research, Turbo Tax recommends reporting those withdrawal as 'Other Income' but when I look at the 'Wages and Income' section under 'Federal' I do see 'Other Common Income' section, but I am not sure what form I am supposed to file under. The options that are available under 'Other Common Income' are 1) Refunds Received for State/Local Tax Returns 2) Other 1099-G Income 3) Form 1099-NEC 4) Form 1099-MISC 5) Form 1099-K. 

So, my question is where should I report my withdrawal as Other Income in Turbo Tax? Or does Turbo Tax automatically fill that excess contribution amount during filing when I select 'Ok, we'll withdraw the full $ excess contribution by April 18, 2022'?

[AamilD]

Yes that is correct, you will select the option which states "Ok, we'll withdraw the full $ excess contribution by April 18, 2022'". If you plan on doing a withdrawal. If you select this option, your refund amount should go up / amount you owe should go down since TurboTax will remove some of the penalties caused my excess contribution.

However, if you don't plan on withdrawing by April 18,2022, you will select the option which states " No, we're not going to make this withdrawal." If you select this option, the excess amount will be taxed an extra 6%

[sanjeev40084]

@AamilD thanks for the reply. Do i need to report the excess contribution as 'Other Income' in Turbo Tax or not?

[sanjeev40084]

@AamilD any update on this?

[AamilD · Accepted solution]

@sanjeev40084  TurboTax will automatically add the excess back to schedule 1, other income for you when you select the option to withdraw. You don't have to enter it manually. Once you select the withdrawal option, TurboTax will automatically add the excess as other income.