Error #55150 - Medical Reimbursements not excluded in IN

[Mercied]

I have a NR Indiana client who has an HSA.  I'm getting a critical diagnostic #55150 "Certain medical reimbursement exclusions (under section 3702 of the CARES Act) are not recognized in Indiana, and therefore should be excluded from Indiana gross income. Use the Current Year Conformity add-back field in the Indiana Modifications screen to make an entry."   I tried entering the amount of her HSA distribution that was used for medical expenses (the whole thing) but I'm still getting that error.  I also did some research to see if I have to do this at all.  They are full year non-residents and are only filing an Indiana return because they received a K1 from Indiana.  In doing my research, I don't even see that the Nonrecognition of Medical Reimbursement Exclusion even exists.  According to the Indiana Department of revenue, here are the Current Year Conformity Add Backs: Indiana 2020 and 2021 Federal Legislation .  Unless Indiana didn't update all this on their website, I don't see where this should be an issue.  

[qbteachmt]

Are you sure that even applies to your issue? You stated "the whole thing" but 3702 is the over-the-counter items, such as sanitizer, masks, and other personal items not requiring a prescription.

[Mercied]

When I said "The Whole Thing" I meant the entire SEP distribution.  The Issue I'm having here is that this may not apply to my client but I'm getting an error message regarding it.

[qbteachmt]

"I meant the entire SEP distribution."

SEP or HSA? I'm a bit confused.

If that is HSA, and you don't have anything that matches this clause, then don't enter anything for that clause.

Form 8889 is for contributions and distributions, and you don't have anything to exclude if it isn't part of the OTC items.

[Mercied]

I meant HSA.  It was one of those days..

[meilinyu-cpa]

I have the same scenario and Critical Diagnoticeas you did in 2022, and this is 2024.  Apparently, Intuit does not have a support team who reads the Community Posts and fix the problem. Did you ever figure out how how to fix the Critical Diagnostic?  Thank you.