Help - HSA excess contribution form 8889

Forum|Forum|2 years ago
March 5, 2024
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Let’s say I contributed 3k in 2023 via payroll deductions but my limit is 2k

so for 2023, I overcomtributed by 1k

in 2024, I withdrew all excess contributions + earnings

for my 2023 form 8889, do I tell the IRS my contribution was 3k or 2k?

I’ve been hearing mixed opinions

Not A Product Question

Best answer by dmertz

If you made an excess HSA contribution, TurboTax will notify you that you did so and will give you to opportunity in the HSA section to indicate how much of that excess contribution you had returned. If TurboTax does not tell you that you made an excess HSA contribution, you apparently did not do so and you were not permitted to obtain a return of any of the contribution; only excess contributions are permitted to be returned.

DavidD66

It depends. If it is a contribution you made directly, if you withdraw the excess contribution and any earnings by the due date of your return (April 15th for most) you can treat it is if the excess contribution was never made. You will report the earnings as Other Income on your 2024 tax return.

If it was an employer contribution reported on Form W-2 your Form 8889 will reflect a contribution of $3,000, and you will enter a removal of excess contribution of $1,000 which will be reported as Other Income on your 2023 return since it was excluded from income. Any earnings must be reported as Other Income on your 2024 return.

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Jonwang789Author

It was through payroll.

this might seem like a dumb question but if I leave it as 3k on the form 8889, how will the irs know I withdrew the excess and not make me pay a penalty?