Hi qbteachmt,

if you read my notes, they contributed full amount for 2018 $6900 as family plan, but the previous CAP treated as if they were one spouse qualified and only deducted half.

The problem is they never had qualified HSA account to begin with for 2018-2020, but they made contribution, for 2018 (deducted half), withdrew in 2019 

Made contribution in 2020, although was not deducted on tax return, but distributed/withdrew 

So if we treat the distribution as none qualified distribution, will have 20% penalty