I am treating each tax year separately.  I was wondering if the HSA balance was less than the total contributions, what effect this has for him.  I believe that his financial institution holding the account will return all funds to him, and he will pay the income tax on the annual ineligible contributions plus the excise tax on the EOY balance each year until 2021 tax return.  

Am I considering everything here?  Should I ask for a waiver of any extra late pay penalties assessed with the return or wait till it is assessed?

thank you for your input!