How can I get rid of a penalty on an over contribution to an HSA withdrawn before the end of the year?

Forum|Forum|6 years ago
December 7, 2019
8 replies
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ProSeries Professional

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Best answer by IntuitCharlene

There are 2 ways to remove the Penalty. IF the contributions were through the W-2 then on the 8889 go to the Line 12 Excess Employer Contributions Smart Worksheet and enter the amount of line B. If the contributions were entered directly on line 2 the Tax Help for line 2 states "Do not include any excess contributions that were withdrawn by the due date of the return. As noted in the IRS instructions to line 13 of this form, such amounts are treated as if they had not been contributed."

IntuitCharlene

Answer

Community Manager

There are 2 ways to remove the Penalty. IF the contributions were through the W-2 then on the 8889 go to the Line 12 Excess Employer Contributions Smart Worksheet and enter the amount of line B. If the contributions were entered directly on line 2 the Tax Help for line 2 states "Do not include any excess contributions that were withdrawn by the due date of the return. As noted in the IRS instructions to line 13 of this form, such amounts are treated as if they had not been contributed."

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Accept as solution" and then just changing the Accept as solution to Mark as Best Answer, mine gets cutoff, so it is too long. I changed mine to the following and it fits. -->**Say "Thanks" by clicking the thumb icon in a post**Click "Mark as Best Answer " to mark the post that answers your question.

rbynaker

Level 13

All I can offer at this point is that the 2018 software functions differently than the 2017 software. It looks broken to me, but it could just be they want it entered a different way. I entered the same info in 2018 and 2017 and got a completely different result.

This is the first we've heard of it in the community so it might not be a known bug. You may need to call support to report it.

There's an "Ask me anything" going on, so you might also try asking there.

Rick

rbynaker

Level 13

@Charlene_At_Intuit any reported bugs on HSA corrective distribution programming in 2018?

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