I have no need to file yet, likely will wait until at least early April. By then, TT might have something more definitive on this.
But for now, I share the concern. I noted previously that, in the eyes of the law, Rev. Code Sec. 1001 provides that any item of income is taxable ... unless expressly provided otherwise. Of course, the tax code is replete with exceptions!
TT has connections to the IRS that most folks don't, and perhaps can lean on them to get a clarifying answer. Meanwhile, I am not convinced that TT's answer is right. There must be actual authority ... Code, Reg., or other official IRS pronouncement ... to support excluding MCTR from taxable income. Without cite to such authority, I am uncomfortable relying on TT's opinion, however well-founded it might be.
Of course, the tax effect on the income amount is not very material. If I exclude it and they later hit me up for tax, it's not a biggie. If I include it and it turns out not to be taxable, I could amend the return; but that can open Pandora's Box. If I exclude and they seek additional tax, likely they would not hit me with penalty; as, relying on TT's opinion that affects maybe thousands of filers might be seen as reasonable basis for excluding. In which case, adjustment but no penalty.
