Turbo Tax thinks I had a break in HDHP health plan coverage during 2019, but I didn't. Where do I go to make sure Turbo Tax knows I had health insurance all year?

[BillM223]

"Unfortunately, my high deductible plan doesn't allow it." I have never heard of an HDHP that didn't allow you to form an HSA. Are you sure that you have an HDHP? Can you contact your insurance company and confirm that?

"I also have no W-2s since I'm self-employed." You don't have to have a W-2 to contribute to an HSA. Our answers generally cover W-2s because the vast majority of taxpayers with HDHP coverage are employees, however, you can make contributions directly to an HSA. You don't get quite the same tax break, but it's better than nothing. In the HSA interview, you can enter "personal" HSA contributions made to the HSA, not through the employer.

"At the question Tell Us About Your Health-Related Accounts, I choose None" - yes, that's fine.

"The next question asks: What Type of High deductible health plan did you have on Dec 1, 2020. I choose Self only since according to the information popup, I'm an eligible individual (whatever that means.)" - No, as I explained above, you need to answer NONE here, because you did not have an HSA in 2020 nor did you contribute to it. Really, in your case, NONE is the right answer.

[jstemarie13]

I'm well aware of what I have, and when I bought it in 2010 there were a number of HDHPs that weren't qualified to have an HSA associated with them. Thanks to the ACA I can't switch. But if a $10k deductible isn't a high deductible plan, I don't know what is!

At this point I'm going to be thankful that the individual mandate in the ACA was struck down. And perhaps you should get out more? But thanks for trying. I just hope that TT isn't making mistakes on my return that will cost me!

[DawnC]

You have a health plan with very high deductibles, but for tax purposes, the plan is not and never was tied to any HSA account.   So, when you get to the question about ''What type of HDHP did you have on 12/1/2020?'' you should answer NONE instead of 'self'.    I know the question sounds like you should answer SELF, but it is asking only to determine if you over contributed to an account you don't even have.   

Change you answer to that question and you will not be prompted with any ''lapse of coverage'' messages going forward.   TurboTax will do the calculations correctly.  The ACA certainly did not help your situation, but TurboTax will ensure you get the maximum deductions, despite the ACA.....See the links below to make sure you are getting the maximum tax deduction for the premiums you are paying.

You may be able to deduct medical, dental, and long-term care insurance premiums for yourself, your spouse, and your dependents if you or your jointly-filing spouse is self-employed.  This link explains more.

• This health insurance write-off is entered on page 1 of Form 1040, which means you benefit whether or not you itemize your deductions.
• Unlike an itemized deduction, this deduction treatment is beneficial because it lowers your adjusted gross income (AGI).
• Having lower AGI can reduce the odds that you’ll be affected by unfavorable phase-out rules that can cut back or eliminate various tax breaks.

Deducting Health Insurance Premiums If You're Self-Employed - More info              @jstemarie13

[heatherado]

I see now that as the spouse of an HSA owner, I should have answered NONE for myself instead of family plan. I removed and added the W2 back in, but I did not get that screen again. Can you tell me what to do so I can access that screen and answer differently?

[BillM223]

Dear Spouse of HSA owner: If you did the full "delete" of your HSA data (see my answer on 2/1/2022), then you should be able to go back into the HSA interview, answer the questions that you did before for your spouse, and then at the end of the interview (right after the HSA Summary screen), you (not your spouse) should be asked this question. Note, it will ask this question only if you did not show any HDHP coverage for yourself in 2021 - in other words, you did not check the HSA box for yourself and did not go through your own HSA interview (watch for the use of first names in the HSA interview, because if each of you had HSAs, then part of the interview would run twice, once for each of you).

@heatherado

[tamarr2]

Hello! Hoping that someone can help me with this- I see the chatter, but none of it addresses a specific question.

I had an HDHP in 2020. In mid-December 2020, my husband's job opened up for open enrollment and we signed up for a HDHP with his company. I terminated my HDHP policy with my company triggering the "life events" exception. If I check the "Family" box for December, it increases my taxes by 1K because it is taxing all my tax free contributions to my own HSA for when I was on my own plan. This cannot be right, so I just changed the box to "self".

Can someone explain to me if this is correct? I was covered by a HDHP all year in 2020 and in 2021, and because of how the software seems to be set up, it is unclear to me on how to reach the appropriate taxable income for this situation. I do not believe that my contributions to my HDHP in 2020 should be taxed in 2021, but perhaps I am not understanding the tax regulation clearly. Need help please. 

[BillM223]

This occurs when you see the question "What type of High Deductible Health Plan did [name] have on December 1, 2020?"

It is trying to see if you took advantage of the last-month rule in 2020. Unfortunately, TurboTax asks this question of everyone, including a lot of taxpayers to whom the question doesn't apply.

According to what you have said, you had HDHP coverage for all of 2021. The type of coverage depends on what you have on the first day of the month. I am guessing that you said Family because you got this some time after the first when you joined your husband's policy, and that on the first day of December, you still had your Self-only policy.

Answering "Self" was the correct thing to do, because that's what you had on December 1st, right?

[BillM223]

This occurs when you see the question "What type of High Deductible Health Plan did [name] have on December 1, 2020?"

It is trying to see if you took advantage of the last-month rule in 2020. Unfortunately, TurboTax asks this question of everyone, including a lot of taxpayers to whom the question doesn't apply.

According to what you have said, you had HDHP coverage for all of 2021. The type of coverage depends on what you have on the first day of the month. I am guessing that you said Family because you got this some time after the first when you joined your husband's policy, and that on the first day of December, you still had your Self-only policy.

Answering "Self" was the correct thing to do, because that's what you had on December 1st, right?

[peachberry]

Perhaps this is what happened to me as well. It has been happening year after year. So frustrating that TT hasn't cleared this up.

[bamkc]

This is a bug in the software. And 2 years after this thread started, it still exists. If a question asks whether someone had HDHP coverage on a particular date and the answer is yes, they should not be required to answer no to get the correct result. I have spent 45 minutes sorting out this extremely basic data point on my joint return for the 2021 tax year.

[bamkc]

In software development we call this a bug. Two years later it is high time this one gets fixed.

[Pyrocumulous]

This is a terribly worded question that is rolled over year after year, FIX IT ALREADY!
What are we paying for anyway? The IRS has better wording than this.

[alan_harrison]

This doesn't work; TurboTax doesn't ask me the question about having coverage all year.

[BillM223]

"This" doesn't work for what? Are you saying that TurboTax is not stating that you had a lapse in HDHP coverage? If not, then what is your concern?

@alan_harrison