Here is the 2014-7 from IRS Link 2014-7
This notice provides that certain payments received by an individual care provider under a state Medicaid Home and Community-Based Services Waiver (Medicaid waiver) program, described in this notice, are difficulty of care payments excludable under § 131 of the Internal Revenue Code.
TurboTax can exempt income under Notice 2014-7 per the IRS instructions. This Notice provides that certain payments received by an individual care provider under a state Medicaid Home and Community-Based Services Waiver (Medicaid waiver) program, are difficulty of care payments and excludable as income.
I checked with the Arizona Department of Revenue and found no reference to the 2014-7 Act. Does not appear to be excludable in your state. If you found otherwise, please use the instructions above to exclude your income in AZ.
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