Vanessa A, Please help confirm which instruction to follow : a) Whether I should delete my IHSS W2 or b) if it is ok that I followed the instructions below and if I will be able to still e-file and without errors. Thank you!
In the post below, MarilynG1 had suggested
https://ttlc.intuit.com/community/taxes/discussion/w2-with-zero-in-box-1-ihss-live-in-provider-quest...
Enter your Box 3 amount into Box 1 of your W-2 (reported as $0), and choose 'Nontaxable Medicaid waiver payments that qualify as difficulty of care payments' on the Uncommon Situations page, on the following pages indicate that 'all of it' in Box 1 is for difficulty of care payments, and that you did not get any other difficulty payments that are not in Box 1 (since you're entering the Box 3 amount already).
This removes the income from taxation, but includes it for any credits you may qualify for (EITC, for example). You'll see the income included on Form 1040, Line 1, but then subtracted out on Line 8.
Your Efile will be rejected with a $0 in a W-2 Form in Box 1.
