There is no way to avoid a taxable excess on Forms 8889 through reporting or allocation after the fact when both spouses have separate HSAs and the combined employer contributions exceed the family limit. Employer HSA contributions are attributed to the employee and cannot be reallocated or recharacterized between spouses to avoid a taxable excess.
For your married couple (both age 50), each spouse must report the actual contributions (including employer contributions from Box 12, Code W, of their W-2) to their own HSA on their respective Form 8889. The total combined contributions for the family cannot exceed the 2025 family limit of $8,550. Since the combined employer contributions are $9,500, there is a $950 excess.
To avoid a taxable excess and the 6% excise tax, the couple must withdraw the $950 excess (and any earnings on it) from the HSA(s) before the tax return due date (including extensions). The withdrawn earnings are included in income, but the excess contribution itself is not taxed if timely withdrawn. If the excess is not withdrawn, it must be reported as an excess contribution on line 13 of Form 8889, and the 6% excise tax is calculated on Form 5329.
In summary: The only way to "squeeze" the excess out and avoid tax/penalty is to withdraw the $950 excess (plus earnings) from the HSA before the tax return due date. There is no reporting workaround on Form 8889 to avoid the excess.
