Get your taxes done using TurboTax

If filing a joint return then enter the 1099-Misc for the CA Middle Class Tax Refund once and select either you or your spouse it doesn't matter.  

If you file separately then each of you will enter a form 1099-Misc and put half of the amount on each return.  

This MCTR amount is not being counted as taxable income so there has been an update for this MCTR form entry.  You will need to delete and re-enter the form 1099-Misc for the MCTR.

1. Go back to the "Wages and Income" section.
2. "Edit" the 1099-Misc
3. "Delete" the form entry
4. Click "Done"
5. On the summary page scroll down to "Other Common Income"
6. "Revisit" the 1099-Misc topic
7. Re-enter the form information
8. You will arrive at a page titled "Does one of these uncommon situations apply?"
9. Click the button "This was a California Middle Class Tax Refund (MCTR)
10. Finish the interview section.

This will automatically exclude this amount from federal income. On the federal tax return, the MCTR payment will reflect as a positive amount, as well as a separate negative amount.  

Both the positive and negative amounts will show on line 8z on the Schedule 1.  You can see these entries in the forms view for desktop versions or in the online versions by following these steps:

1. "Tax Tools" in the left hand menu
2. "Tools"
3. "View Tax Summary" in the main screen
4. "Preview my 1040" in the left hand menu

The income will no longer be in the Federal Adjusted Gross Income amount and therefore will not transfer to the CA tax return either.