How and where to Post claim "IRS Notice 2014-7 excludable income"

[xmasbaby0]

@JNSII This thread is really really OLD.    Please explain what you are trying to do so we know how to help.

[genray86]

You can only go back 3 years I believe. I would try to find a tax professional to help you file this as it's been a challenge getting mine to go through. I amended 2018 in October 2019 to add these payments with the help of a tax professional and we followed the instructions on irs website to a T. Within 2 months they rejected wanting more documentation. Resubmitted with more documentation along with 2019 in Feb 2020... rejected 6 months later, again more documentation required. Sent documentation they requested, month later, closed accounts. We are once again resubmitting 2018, 2019 and filing 2020. Documentation included: proof of residence for both you and individual you are receiving payments for (biggest piece because you must live together to receive medicaidwaiver payments), proof of receiving medicaid waiver payments, letter with header and tax ID from oversight agency, letter from case manager, copy of my states shared living manual, copy of mine and individual supporting social security cards. I THINK that's it... the list keeps growing! Next they will want blood type or something! Good luck!!!

[Jbsd]

OK so please explain to all of us how you did it, because several people on this platform are having the same issue and they’re all saying they were not able to file their forms electronically. 
Give us your wisdom Yoda. Because so far I tried to get them to do my taxes for me and they said they couldn’t even though I had upgraded to Deluxe. Unfortunately this problem is just too complicated for them.

[xmasbaby0]

@Jbsd It is not clear what you are trying to do.   Are you trying to amend past year tax returns?   TurboTax does not provide a service to amend past year tax returns for you, nor can a past year amended return be e-filed.   

If you are trying to prepare a 2020 return and want someone to prepare it for you then you are asking for Live Full Service---not just "Deluxe."     But Live Full Service can only be used for a 2020 return---not for past year returns.

https://ttlc.intuit.com/community/choosing-a-product/help/what-is-full-service-by-turbotax-live/00/2...

[genray86]

Amended returns have to be done via paper form. I am using a tax professional from H n  R block who is submitting 2020 electronically.  Again, I would highly recommend calling around asking if anyone is familiar with these payments and to have a professional help with them as they are not very straight forward for a non tax person to complete properly. Ensure when you do submit to include ALL documentation to verify income, address for you and the individual you support and any other documents to support receiving Medicaid wavier payments. 

[Jbsd]

I agree! In my experience this week I have had to explain the situation and all the tax precedent laws etc. to three CPAs. TurboTax was not capable of handling this issue even though at first they assured me they could. Then they asked me to upgrade to Deluxe. Then after upgrading and moving forward with my taxes they got stuck again. You would need to fill out paper taxes, back it out on line eight, explain IRS 2014-7(which I’m sorry but 2 to 3 years later they should already understand),  and write down a reference to the FEIGH tax court ruling. 

[Llozano10]

If IHSS is the only income and you filing to get your withholdings back, how do you get the return to go through electronically.  Turbotax says: athe tax withheld of $2000 as shown on form 1040 is greater than or equal to $0, the sum of income from the following sources...

[ReneeM7122]

If your only source of income is IHSS, you do not have to file, but you can.  Use the following link to eFile your tax return to get your withholdings back.

[ChuckH70]

How do I handle IRS Notice 2014-7 payments in turbotax if I received a form 1099-NEC?

[JeffreyR77]

You can enter the 1099-NEC income in TurboTax in Wages and Income, Other Common Income, 1099-NEC:

You can then exclude the income per RS Notice 2014-7 by going to Wages and Income, Less Common Income, Miscellaneous Income, Other Reportable income and entering a negative amount in Other Taxable Income to offset the 1099-NEC reported amount.:

[motelco2]

Thank you - this worked out. I filed an amended return; they are way behind in processing due to the pandemic.

[Steve371]

Renee's answer is naive.  As previously noted, Notice 2014-7 allows the taxpayer(s) to retain the benefit of the earned income represented by the W-2 while offsetting all the income reported on the W-2.  Therefore, in addition to filing for the refund of taxes withheld, one might also file for refundable tax credits such as the Earned Income Tax Credit or file for state refunds.  Arguably you can start the clock on the statute of limitations and in some cases one may need to show a filed tax return.

Note that the statute of limitations cuts both ways, the taxing authority can't audit the return absent fraud nor will that taxing authority issue a refund after that.

If TurboTax won't let you e-file, reflecting IRS' e-file requirements not TurboTax's, you can you can either add $1 to miscellaneous income which in most case won't make any difference or will make a tiny difference probably due rounding errors, which can be done if you expect a state refund and want to e-file, or just offset the W-2 income with $1 less than the W-2 income so that there is an AGI of $1.

[bhupalkhanal]

I work as the Direct Care worker for my mom and receive a difficulty care payment through state medicaid, does this income considered earned income? Can I exclude this income from the calculation of Earned Income Credit and Child tax credit? If I can exclude then how can I do this in turbotax software?

[KrisD15]

How was the income reported to you? Did you receive a 1099 or W-2 reporting the payments made to you? 

[bhupalkhanal]

I got w-2 with income reported in box 1.