Bogleheads.org

celia wrote: ↑Sat Mar 25, 2023 8:03 pm

Peter Foley wrote: ↑Sat Mar 25, 2023 4:04 pm I set up a checking account to go with my IRA at Schwab. I've had no trouble writing checks to charities and having them characterized as QCD's.

Is your checking account titled as an IRA? If not, you are first withdrawing to a Taxable checking account, then making a charitable donation that can be included in your deductions, if you itemize.

Some IRA custodians provide checks which draw directly from the investment account and are not a separate checking account. It sounds like that is what @Peter Foley is talking about. If so, a check written that way should qualify for QCD treatment, provided of course that the other QCD rules are met (over 70.5 on date of donation, written to 501(c)(3), and donation receipt obtained).

For purposes of the kiddie tax, my Tax Aide resource indicates that taxable scholarships count towards unearned income, and unearned income over $2,300 is the first question in screening for whether or not Form 8615 must be completed by the child. You might call to see if the stipend will be reported on a W-2. If so, it would be earned income and *not* count towards the kiddie tax. There are other screening questions other than the amount of unearned income to determine if filing an 8615 is required. Age of the child, whether or not a full time student, earned income relative to support, whether they file a joint return, and whether or not their parent(s) are alive all are additional factors to evaluate. For a typical case - i.e. one where ...

Several different questions there. [ Crossposted with bsteiner First, I would start doing your tax returns and the tax returns of the trust properly. Educate your uncle on 1041s and K-1s. Second, you could consider amending all of your and the trust's tax returns for the past three years or so to fix them. This is going to be a hassle and will almost certainly result in an increase in taxes because of how retained income is taxed in trusts. ] As far as moving from stocks to index funds while you have unrealized capital gains, the usual strategy I have heard is to do it slowly over time and spread out the capital gains over several years and keep them in a lower bracket. So if, for example, you have $100K in unrealized CGs, generate $20K of ...

We are currently living in NJ and when I compare cost of living of these three areas to where we are Boise is 4-6% less expensive, Colorado Springs is 6-9% less expensive and Grand Junction is 12-14% less expensive. I have used our current NJ expense structure in our estimates, so a 5-10% reduction could be possible (your point). Did you use some cost of living comparison calculator? I would have thought Boise would have been more like 20% cheaper overall than NJ. Admittedly I'm thinking of the Philly - NYC corridor part of NJ, which is the only part with which I am even slightly familiar. In any case, I'd make the standard suggestion of living in Idaho and Colorado for a month or so each, which would allow you to get a much more accurate ...

I agree with @jebmke. Doing everything today in today's dollars with today's tax structure is going to be close enough and applying inflation rates to everything is just as likely to make your estimate worse as it is to make it better. If you had wildly divergent assumptions about rates over long periods of time (like investment return of 7% and inflation of 3% over 20 years), then I might consider it. But that doesn't apply to you. I'm not sure where you're coming from, but it sounds like not Colorado and not Idaho. If so, one thing to consider is that the cost of living difference between wherever you live now and where you retire to could easily dwarf any inflation adjustments over 4 years. I live in Idaho and the budget you outlined wou...

(Crossposted with the above.) Most likely the IRS adjusted your tax return based on information they received associated with your SS number. It could be any number of things. Perhaps you failed to report all of your income. Perhaps you claimed a credit or deduction to which you weren't entitled. Perhaps you owe federal taxes for a prior year. Perhaps you entered in the amount of federal withholding wrong. Unlikely but possible that TT made a mistake if you have a very unusual tax situation. Perhaps something else. The most common type of error is a data entry error into TT. You could double check all of your dollar amount entries on every line of every form. You should receive a letter from the IRS addressed to you at the address you provi...

[The following assumes you didn't rent out the house or use it for business or live in it as your primary home any time after your uncle passed away. If any of those are true, then it gets more complicated.] Thank you all. I'm using H&R Block Deluxe. I believe I'm correct to enter this as "tell us about business property you sold" and then Form 4797. I entered the address as the property title, the date transferred to and from and the same amount as the amount received from sale and the adjusted basis. This doesn't appear to have changed our overall taxes. Am I correct? Thanks! Probably not. I doubt it was business property. What makes you think it was? You should probably report the sale on Form 8949. The proceeds would be th...

toddthebod is right. You can change the beneficiary any time you want. In my state, I can also make unlimited tax-free partial transfers between my three kids' three 529's. I do that as my kids' plans change to make the account balances what I want. I think you can do this in most states but I'm not sure. Some reasons to have a separate account for each kid: 1. There is a new provision in the law that enable 529-to-Roth transfers which help address the overfunding situation. But one of the conditions of this new law is that the account has to be in the beneficiary's name for 15 years and can only be transferred to that beneficiary's Roth. How this will work in practice is still up in the air a bit, but having two separate accounts for your ...

If you dig into the law and regulations, it appears to me to be gross income (as defined in 26 USC 61(a)) for all members of the household must be under 200% FPL. It appears to exclude federally tax exempt income.

Besides the income test, there are also other ways to qualify: being on Medicaid, SNAP, SSI, receive reduced price school lunches, or even apparently receiving a Pell grant.

If there will be any delay because you're working through the trust succession stuff, I would contact the broker and inform them so they can lock access to the account. Nobody should be able to do anything with the assets until either the executor is appointed and can provide the appropriate credentials, or the beneficiaries can provide the death certificate, or the successor trustee is in place. The executor is not involved in the trust at all. Oh, I know. Chalk it up to a combination of a second reading of the OP indicating that it was a trust, sloppy editing, and an attempt to speak in generalities in case OP wasn't being accurate about the situation or in case other readers were interested in the topic. My bad. That's why I added the &...

Well, the first page of the document you linked to points to a Treasury regulation saying you don't have to report it.

Whether that's good tax advice or not, I have no idea.

But I think it would be reasonable for a taxpayer to rely on it.

Even if the $6.25 is taxable income to you, there is a reasonable argument that filing an amended tax return would take more resources of yours and the IRS than the would be owed in incremental tax liability, so it is economically a bad idea and the IRS would be OK with that.

Were I in your shoes, I would file a copy of that document with my tax records. I would not file an amended return.

Social Security publishes information on who has passed away. My understanding is that many financial institutions subscribe to the list and take appropriate action when one of their customers passes away. But it's a pull system by interested institutions, not a push system from SS.

The receiving bank will not notify anyone for you. At most they might lock down the account if they become aware.

I would plan on the executor notifying all of the CGAs individually and directly. If they make an after death payment, I suppose they may be able to and may choose to claw it back, but I don't really know for sure.

SC Anteater wrote: ↑Thu Mar 16, 2023 5:09 pm Yes, I'm successor trustee. So I do not have access to the account right now, only an old statement with the guy's contact information.

Right. Then it will probably take waiting for the death certificate. I'd notify the broker just to protect the account while the succession stuff is in process. Alternatively, if you can see the account and are willing to monitor it but not touch it yourself, you could consider doing that as well. I think some BHers would say you're not supposed to use her credentials, nor should you use your POA credentials now, because they're not valid any more. I respect that opinion.

My 13 yo has a UTMA account where the 1099-B shows a short term loss ($32) and a long term loss ($1630). Do I understand I'm not required to file a return because their income does not exceed $1050. However, it would be advantageous to file a return showing this loss to establish the carryover. If he starts work in 2024 and has earned income, we'd start subtracting that $1630 until it is consumed. However, I imagine he'd still be under the threshold of $12,950 required to file a return, and therefore this all would be a waste of time? They will not have any investment income in the coming years. Whether or not the 13 year old is required to file a tax return is determined by Charts B and C in the IRS Form 1040 instructions under "Who ...

My condolences. The death certificate is faster than that in my state - I think it was about a week. Unless there's some delaying factor with your mother or your state. You said you're the trustee of the account. There should be no need to notify the broker of her death if that's true, at least AFAIK. You should be able to manage and/or distribute the assets of the trust as the trustee per the trust documents. If you're not yet the trustee and would only become the trustee through succession, then see the next paragraph. If there will be any delay because you're working through the trust succession stuff, I would contact the broker and inform them so they can lock access to the account. Nobody should be able to do anything with the assets u...

Do the terms of the trust require distribution of all of the income?

If they don't, then the trust will just get to pay taxes at the trust rate on the income that was not distributed. It makes the preparation of the trust tax return a bit more complicated, but a tax preparer experienced with trust tax returns should be able to handle that.

If they do, I don't know.

They'll increase costs as long as they have a waiting list. Most places have waiting lists. My Dad's place has increased costs every single year for the past 17 years. From 2022 to 2023 they went with 8.7% to mirror the SS increase. Not a very good rationale, but that's what they did. Considering that SS is indexed to inflation, seems like a decent rationale to me. Sure, except the inflation components that SS is based on may or may not match the input costs of a CCRC. And more importantly, an average senior's SS payment is only a fraction of the CCRC monthly rent. A $2K SS check going up 8.7% (probably less after accounting for Medicare premium increases) is less in dollar terms than a $10K CCRC rent bill. I went through a bunch of their ...

They'll increase costs as long as they have a waiting list. Most places have waiting lists.

My Dad's place has increased costs every single year for the past 17 years. From 2022 to 2023 they went with 8.7% to mirror the SS increase. Not a very good rationale, but that's what they did.

I have a general durable POA, which is on file with his investment custodian, his bank, his hospital system, and his health insurance company. The credit card, when offered the POA, added me as an authorized user instead. I'm his representative payee with Social Security. I'm in the process of getting the POA processed by his pension and by our state 529 program to handle one last 529 account there for my niece. Just recently, he asked me to take over all his bills and mail, so I've been changing mailing addresses and contact phone numbers and emails from his to mine to facilitate that. Lately it's been a lot of medical providers. So I can generally pay his (mostly medical) bills which come to my address now with his credit card, which is a...

If she moved the money properly (within a 60 day window) from the decedent's 401(k) into an inherited IRA, then you're correct. The rollover would not be taxable and she would only be taxed when she takes distributions. The Empower 1099-R is probably because they don't know what she did with the money. There should be a way in your tax software to indicate that the full amount was rolled over. This should then have the effect or reducing to zero the amount of the distribution that is taxable. If she missed the 60 day window, then there may be circumstances where the IRS would grant a waiver (and treat it as a qualified rollover). See IRS Revenue Procedure 2020-46 for more details. And yes, generally she has 10 years to empty the IRA. I don'...

Two possibilities: First, you had a wash sale. It looks like you bought 16 shares of the stock sometime within 30 days prior or 30 days after the sale of these RSUs. I think this is also why the sale is split into two parts. The first part, 10 shares, is the part that doesn't have a wash sale. The second part, 16 shares, is the part that has the wash sale. The wash sale disallows part of your loss and increases your cost basis. The second thing is that you probably had some transaction costs associated with the sale. Those are either added to your cost basis or reduce your proceeds - I can't recall the rules offhand there. But it sort of looks like the amounts of your transaction costs are sort of high. My only guess there is that you sold ...

I think you might not be completing the tax return properly. From the instructions for Form 8962: "Married filing separately. If you file as married filing separately and are not a victim of domestic abuse or spousal abandonment (see Exception 2—Victim of domestic abuse or spousal abandonment under Married taxpayers above), then you are not an applicable taxpayer and you cannot take the PTC. You must generally repay all of the APTC paid for a qualified health plan that covered only individuals in your tax family." -- https://www.irs.gov/instructions/i8962#en_US_2022_publink100014925 When you're not filing jointly, what filing status are you using for your wife? Are you sure she doesn't have to repay all of her APTC per the above q...

A CPA or tax preparer will probably charge you a couple hundred dollars for that kind of return.

AARP Tax Aide would probably be able to do them for free, depending on a couple of things, mostly around your wife's 1099-NEC. Did she have employees, or a home office deduction, or a net loss, or ACA health insurance, or depreciation?

Home mortgages typically don't matter. The mortgage interest she and BIL pay might be deductible as an itemized deduction on her or his federal tax return. But since she and BIL are statistically unlikely to benefit from itemizing, it's probably a zero impact item and can therefore be ignored.

Fourth, I think you overemphasize new safety technology. My 1993 car has seatbelts, airbags, antilock brakes and good visibility. I feel perfectly safe in it and don't feel the need for backup cameras, side pillar air bags, etc. I don't know what a 2016 Toyota has, but it's probably got somewhat better safety features. I don't know the difference between a 2016 Toyota and a 2023 Toyota in terms of safety. There have been significant improvements in car safety from 1993 to 2023, and not just "safety features". Look at some crash tests from both time periods, or even 10 years ago. The improvements are dramatic. Side airbags also help a lot in many types of collisions. I agree with you that newer is safer.(*) More expensive and more...

You're arguing for leasing a car as a better way. Fine, no argument from me. But I think you are justifying it to yourself as better because that is your preferred conclusion, and in doing so you're not really doing an objective analysis. I'll point out a few ways just because I see them. I really don't want to debate, though, so if you want to debate further you'll have to look elsewhere. First, you account for opportunity cost of capital on the purchase, but ignore it on the lease payments. Second, you ignore the fact that the owner will, when they stop driving, have a $15K (on average) asset. The leaseholder does not. I'm 53 now; supposing I drive another 30 years, that $500 per year you should add back in. That drops the "buy old&q...

Only when the assets are sold. (In the US, and under current law.)

toddthebod wrote: ↑Wed Mar 01, 2023 12:09 pm

secondcor521 wrote: ↑Wed Mar 01, 2023 11:30 am Hi all.

When my mother passed away in 2016, a trust was set up with her assets. For taxation purposes, it is a complex trust because it has discretion on distribution of trust income. It just has some stocks and mutual funds in it and they mostly just sit there and pay out dividends.

From the Form 8960 instructions:

Application to Estates and Trusts
Domestic estates and trusts. The NIIT applies to estates and trusts that have undistributed net investment income and adjusted gross income (AGI) in excess of the threshold amount.

Does the trust have any undistributed income?

Yes. In 2022, the trust retained all income. The year the CPA did the return, I think the trust retained most of the income.

toddthebod wrote: ↑Wed Mar 01, 2023 12:09 pm

secondcor521 wrote: ↑Wed Mar 01, 2023 11:30 am Hi all.

When my mother passed away in 2016, a trust was set up with her assets. For taxation purposes, it is a complex trust because it has discretion on distribution of trust income. It just has some stocks and mutual funds in it and they mostly just sit there and pay out dividends.

From the Form 8960 instructions:

Application to Estates and Trusts
Domestic estates and trusts. The NIIT applies to estates and trusts that have undistributed net investment income and adjusted gross income (AGI) in excess of the threshold amount.

Does the trust have any undistributed income?

Yes. In 2022, the trust retained all income. The year the CPA did the return, I think the trust retained most of the income.

Hi all. When my mother passed away in 2016, a trust was set up with her assets. For taxation purposes, it is a complex trust because it has discretion on distribution of trust income. It just has some stocks and mutual funds in it and they mostly just sit there and pay out dividends. The first year, we had a CPA firm prepare the 1041 tax return because we weren't familiar. Since then, I've prepared the 1041s by putting the current year's numbers in the same place and doing the basic math. I've also tried to learn a bit each year about 1041s and how they work. For the past few years I've been completing Form 8960 for NIIT for the trust, which has resulted in an NIIT of about $500. Even though the income was in the same ballpark and of the sa...

You cannot do both. Let's say you decide you can itemize and want to use medical expenses as part of your total deductions. You'll need to have qualified medical expenses above 10% of your AGI to even begin itemizing those medical expenses. So if your AGI is $75,000 for 2022 and you have $10,000 in medical expenses for 2022, you'll be able to deduct only $2,500 on your tax return (10% of your AGI is $7,500 and you'll be able to deduct anything above that). You will not be able to reimburse yourself for that $7,500 through an HSA distribution (ever). This article will explain it in more detail: https://www.thebalancemoney.com/medical-expense-tax-deduction-3192881 If that article says 10%, it's out of date. For 2022, it's medical expenses ab...

If so, then in 2035, you may not use *any* of the expenses you used to itemize in 2022 (not just the $3,897 above the 7.5% of AGI). Do you have a source specifically on the amounts below 7.5%? There was a previous discussion about that and I remember concluding that you arguably could use that for HSA withdrawals as you didn't actually deduct those dollars. May be too aggressive for me to actually do though. Not specifically. But many sources out there will say that you can't include on Schedule A any medical expenses that were reimbursed from an HSA. And that is without regard to whether or not the resulting medical expenses end up being above or below 7.5% of AGI. And conceptually there are very very few places where double dipping is al...

No, double dipping in this scenario is not allowed. I am assuming you mean that in 2022, you itemized on Schedule A and line 4 is $3,897. If so, then in 2035, you may not use *any* of the expenses you used to itemize in 2022 (not just the $3,897 above the 7.5% of AGI). Said another way, you can't use the expenses which you put on line 1 of your 2022 Schedule A for your 2035 HSA distribution. If you chose to do so anyway, then the HSA distribution would not be qualified and it would end up on your 2035 Form 8889 line 16. The taxation would depend on your age at the time of the distribution; generally speaking it would be taxed as ordinary income, plus a 20% penalty if you're under Medicare eligibility age. Usually this rule is spelled out th...

Be careful with the terms you use. Recharacterizations and conversions are two different things.

You can recharacterize $3500 of your 2022 traditional IRA contribution to Roth. Contact your IRA custodian and use the term "recharacterize". You have until the tax filing deadline including extensions, so approximately October 15, 2023.

Any Roth conversion you do will be a 2023 conversion, but it sounds like you're not referring to one of those.

https://www.bogleheads.org/wiki/IRA_recharacterization

bosul7ly wrote: ↑Sat Feb 25, 2023 6:14 pm Are there any rules governing when 529 distributions for college related expenses may begin?

Nope. The rules for the various qualified expenses are listed in Pub 970.

For computer related expenses, the rule is that it is a qualified expense if:

"The purchase of computer or peripheral equipment, computer software, or Internet access and related services, if it's to be used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible postsecondary school."

-- https://www.irs.gov/publications/p970#e ... k100077339

Which in the case of your son and the laptop, seems to be perfectly fine.

I don't think you're missing anything. Those are the rules, and you seem to be interpreting them accurately. I think there is a typo in your post though - your student is not qualified for the refundable portion of the credit. I think that's what you meant, though. The only advice I can give is for you to read and calculate the support amounts properly related to the test in 1(c). Unless your student graduated last spring and had a decent full time job, it's possible that you provided more in support than you think you did. Although the Form 8863 doesn't reference it explicitly, I'd take a look at Worksheet 2 in IRS Pub 501 for a list of what the IRS thinks qualifies as support and how it's calculated. Assuming the facts are correct (stude...

If your wife left everything to you, and he would be the only other heir, you might be able to "disclaim" it. If the estate is divided between you and the son, you could place that part in his portion. You should really talk to the lawyer assisting you with the probate. I'm not a lawyer, but I read a lot.... Unfortunately, OP probably can't disclaim. One of the disclaimer rules is that the disclaimer must be made within 9 months of the interest being created, which in this case is the date of his wife's passing. I think this part of the CFR applies: https://www.law.cornell.edu/cfr/text/26/25.2518-2. See paragraph (c), Time limit. ... OP, FAFSA does not include retirement assets regardless of whether they are the parent or the stu...

I don't think you're missing anything. Those are the rules, and you seem to be interpreting them accurately.

I think there is a typo in your post though - your student is not qualified for the refundable portion of the credit. I think that's what you meant, though.

The only advice I can give is for you to read and calculate the support amounts properly related to the test in 1(c). Unless your student graduated last spring and had a decent full time job, it's possible that you provided more in support than you think you did. Although the Form 8863 doesn't reference it explicitly, I'd take a look at Worksheet 2 in IRS Pub 501 for a list of what the IRS thinks qualifies as support and how it's calculated.

If I sell my total fund balance that has short term losses in specific id, will that affect furure transactions? I'm thinking that I should switch to avg cost befor selling. Does this make sense? To answer the second question first, no it doesn't make sense. Specific ID is almost always superior to average cost. Notably, if you switch to average cost and then sell, you will lock yourself into using average cost until all shares of that mutual fund which you own are sold. On your first question, there are two ways it could affect future transactions. First, if you sell at a loss, you create the potential for wash sales if you rebuy that same fund within a 60-ish day window around the date of the sale which created the loss. Secondly, your t...

From Form 8949 line 1 instructions @ https://www.irs.gov/pub/irs-pdf/i8949.pdf: "Enter the details of each transaction on a separate row (unless one of the Exceptions to reporting each transaction on a separate row, described later, applies to you)." The Exceptions are listed later on that same page. Exception 1 wouldn't apply in the case you describe because there is an adjustment in box 1g (the "W" code). Exception 2 could apply, but the upshot is that if you choose to aggregate the wash sales, the IRS says you have to either attach the details to your tax return, or if E-filing you must send in the detail transaction information along with Form 8453 to them. You may be fine with reporting a single summary line of wash...

I'd be curious what the executor says as to why the estate tax return has not been processed completely. 2 years and 4 months seems like a long time. But maybe estate tax returns in the time of COVID take that long. I don't know. The executor has an obligation to the estate to pay the debts of the estate in the proper order before disbursing any leftover assets to the beneficiaries. I'm not sure where estate taxes falls on the priority list but I think it's near the top. So the executor may just be very cautious and careful about fulfilling their obligation. Or, the executor may be pulling shenanigans and hoping a delay tactic will work on you. 3 years and 8 months seems like a very long time to me to settle an estate, unless there are comp...

On the taxable account, you should expect a consolidated 1099 from Edward Jones if you received more than $10 in interest, or any dividends. Or if you sold any assets, which it sounds like you didn't. On the Roth account, you do not need to report anything on your taxes unless you made a contribution, conversion or a distribution, which it sounds like you didn't. If you did make a contribution, you'll get a 5498 in May from the custodian who received it. If you made a conversion or a distribution, you should receive a 1099-R from the custodian who held your assets at the time you made that transaction. Since Roths are tax deferred, you should completely ignore the gain/loss document. On the 529, provided you moved all of the assets over to ...

This might be a stupid question but I noticed that I had a wash sale but I don't see anything about it in the 2 tax forms that Fidelity gave me (1099 and 5498). If I print out a screenshot of the following and give it to my tax professional, is that all the info that she'll need? https://i.ibb.co/9WyB6zM/washsale.jpg When I see a similar indicator at Vanguard, it means that the shares you're looking at are the replacement shares from (usually) an earlier wash sale. I suggest you look to see when the last sale of that mutual fund occurred in that account that resulted in a capital loss. It's possible that it was in 2021 or earlier, which would explain why it was not mentioned on your 2022 1099-B. (It's also possible, as has already been poi...

Big Gun wrote: ↑Tue Feb 14, 2023 8:38 pm (assuming Coverdell is viewed the same as 529 in Secure 2.0)

This is a faulty assumption.

The recent law only addresses 529 to Roth IRA rollovers and currently does not apply to Coverdell ESAs.

The law may be expanded in the future, but speculation on future legislation is not permitted on this forum.

I don't know the answer to your question.

But I will mention - perhaps it is useful - that the titling at Vanguard for my Mom's bypass trust is the date that the trust instrument was signed in 1999. This was well before my Mom passed away in 2016.

It's been a few years, but the titling was done per either the estate planning attorney or Vanguard's advice. Probably the former.

Room and board expenses you paid in 2023 for an academic period during which you were at least a half-time student should probably be distributed in 2023.

I would be inclined to treat the refunded security deposit in the same way as a tuition or fee refund from a university. I would redeposit it into the 529 within 60 days and subtract the refunded amount from my educational expenses. I'm pretty sure that Pub 970 talks about how you can put refunds back into 529s...yep, it's on page 51 under "Recontribution of Refunded Amounts" at https://www.irs.gov/pub/irs-pdf/p970.pdf

Sorry, you're right, I should have said Line 24z.

UNCHEEL wrote: ↑Wed Feb 08, 2023 10:05 am My suggestion would be to distribute now anything she has with a loss, so that you can benefit from it. (At death, they would get a step DOWN.)

Note that the basis rules for gifted shares with an unrealized capital loss are different from the basis rules for gifted shares with an unrealized capital gain. The receiver generally cannot receive the stock, sell it, and take the difference between the original owner's basis and the selling price as a capital loss. See here for a description of how things work: https://www.schwab.com/learn/story/how- ... r-receiver

It is generally true that the basis would be stepped down (or up) to FMV at date of death.

I'm not familiar with that particular box. But you're right that the Form 1099-G instructions indicate that the amount in that box may not be taxable depending on the legislation that authorized the grant - it sounds like you have one of those. What I would do is leave the box 6 entry in TaxAct empty and note what TaxAct has as your AGI or income. Then I would enter the $600 in box 6 in TaxAct and see if your AGI increases by $600. If it does, then I would enter negative $600 in Schedule 1 line 8z to back it out, preferably with a note indicating that it is due to a 1099-G nontaxable grant. You should see your AGI return to what it was before. This is a common way of making adjustments that are proper but have no other way of correcting the...

I think you need to distinguish between a return of excess contribution and a distribution. Given that you made the return of excess contribution prior to the filing deadline, you'll recognize it on your 2022 return as you are doing. The $299 is included on Form 8889 already via line 9, which probably got there via the code "W" in box 12 of your W-2 from your employer. And since it was not included in your box 1 wages, TaxAct is doing the right thing by including it in Other Income on your 2022 return. Optum should not report the $299 distribution to you on your 2023 1099-SA because it is a return of excess contribution, not a distribution. Do not add it to lines 14A or 14B of this year's 8889 because it is not a distribution. The...