HSA Excess Earnings

Forum|Forum|2 years ago
February 2, 2024
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Hello!

I want to make sure I understand where HSA excess contribution earnings should go. I received a 2023 1099-SA related to a 2022 HSA overcontribution. The overcontribution was noted in early 2023 and I had both the excess contribution and earnings removed before the tax deadline. The excess contribution was reported as other income via my 8889 form, but I need to do something similar for my excess earnings this year.

2023 1099-SA example: Box 1 Gross Distribution $1200. Box 2 Excess Earnings $200. Box 3 Distribution Code 2

Where exactly do I report the $200 excess earnings with this tax year? In Form 8889, part II 14a and 14b seem to cancel each other out ($1200-$1200). Nothing is triggered in the Schedule 1 other/additional income section. Do I need to manually input the $200 of excess earnings?

Not A Product Question

Best answer by dmertz

The code 2 in box 3 for the Form 1099-SA tells TurboTax to put the amount from box 2 onto Schedule 1 line 8f.

dmertz

Employee

In the HSA section of TurboTax you must indicate that you used the HSA to pay for something in 2023 so that TurboTax will prompt you to enter this Form 1099-SA. TurboTax will include on Schedule 1 line 8f the amount from box 2.

HSAQuestionsAuthor

Ok. I can get it to do that --but I didn't actually use the money for anything in particular, just had it direct deposited due to my mistake. Also, just want to be sure that's where it's supposed to go I guess. I looked at form 8889 and its instructions. By reading through them, I don't know how Turbo Tax is deciding to place the number on 8f vs me putting it in 8z. Form 8889 lines 14a and 14b cancel each other out & I have no qualified medical expenses for line 15. It just seems like its magically placing that line there to me. Would you happen to know why?