Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

How can I get rid of a penalty on an over contribution to an HSA withdrawn before the end of the year?

khudson
Level 1
 
0 Cheers

This discussion has been locked. No new contributions can be made. You may start a new discussion here

1 Solution

Accepted Solutions
IntuitCharlene
Moderator
Moderator
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were entered directly on line 2 the Tax Help for line 2 states "Do not include any excess contributions that were withdrawn by the due date of the return.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"

View solution in original post

0 Cheers
8 Comments 8
IntuitCharlene
Moderator
Moderator
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were entered directly on line 2 the Tax Help for line 2 states "Do not include any excess contributions that were withdrawn by the due date of the return.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"
0 Cheers
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

0 Cheers
rbynaker
Level 13
@Charlene_At_Intuit  any reported bugs on HSA corrective distribution programming in 2018?
0 Cheers
IntuitCharlene
Moderator
Moderator
I'm not seeing anything reported yet. Let me test a few things out and get back to you.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Accept as solution"
0 Cheers
IntuitCharlene
Moderator
Moderator
Were these contributions through the W-2 Box 12 Code W or self made on the 8889?
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Accept as solution"
0 Cheers
rbynaker
Level 13
Thanks.  I don't know about the OP, but I tried a simple entry of 1099-SA code 2 for the corrective distribution and entries on the 8889-T for the contributions but couldn't get it to work without overrides.  You might also pull up 2017 and make the same entries there for comparison.
0 Cheers
rbynaker
Level 13
Great, thanks!  If you convert this to an answer I'll Recommend it.
0 Cheers
IntuitCharlene
Moderator
Moderator
Done and Done :smile: Glad to help!:smile:
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Accept as solution"
0 Cheers