Assuming you first have entered the form 1099-Misc in the "Other Common Income" section which reconciles the form 1099-Misc on the tax return, then you'll enter a corresponding negative amount as "Other Reportable Income."
- Scroll down to "Less Common Income"
- Start/Revisit "Miscellaneous Income"
- Start/Revisit "Other Reportable income"
- "Yes"
- In the description "Home Sale exclusion"
- Put in a negative amount representing the exclusion amount
This will subtract the amount from taxable income.
You can see the forms in desktop versions using the forms mode or in online versions following these steps. Check line 8z on Schedule 1 to see the both the positive entry 1099-Misc and the negative entry "Home Sale Exclusion."
1. Select "Tax Tools" in the left hand menu
2. Select "Tools"
3. Select "View Tax Summary"
4. Select "Preview My 1040" in the left hand menu
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