Get your taxes done using TurboTax

The SECURE Act allows In-Home Supportive Services (IHSS) workers to treat excludable difficulty-of-care payments as earned income for purposes of calculating the worker's IRA or defined contribution plans contribution limits, applicable for defined contribution plans to plan years beginning after December 31, 2015, and with respect to IRAs, to contributions after December 20, 2019  IRC §§408(o), 415(c)(3); SECURE Act §116

 Entering into TurboTax is a bit confusing so please follow these steps carefully. 

1.  Sign into TurboTax and continue through until you can start selecting "Wages & Income" located at the top of the screen
2.  Click on Wages & Income
3. (If the program asks about your W2, select Skip for now )
4. Select answers to the following questions if necessary to move forward 
5. Click Add more income 
6. Scroll down to the VERY LAST option "Less Common Income" and click Show more
7. On this new drop-down list scroll down to the VERY LAST option "Miscellaneous Income" and click START 
8. On this new drop-down list scroll to the VERY FIRST option "Other income not already reported on a Form W-2 or Form 1099. Click START
9. Select YES to the page titled "Other Wages Received" and Continue
10. Select CONTINUE on the "Wages earned as a Household Employee" screen (enter nothing here)
11. Select CONTINUE on the "Sick or Disability Pay" screen (enter nothing here)
12. Select "Yes" on the "Any Other Earned Income" screen and continue
13. Select "Other" on the "Enter Source of Other Earned Income" and Continue
14. In Description Box type "Notice 2014-7" and the amount (NOTE- YOU MUST ENTER ALL THE INCOME OR NONE)
15. Click Done 

This will put the income on your 1040 line 1 where it needs to be. 

Now you need to make an entry so that TurboTax will make the income exempt from tax. 

Go back to the Wages & Income section  (you will be repeating some steps, but not all)

 Scroll down to the VERY LAST option "Less Common Income" and click Show more

1. On this new drop-down list scroll down to the VERY LAST option "Miscellaneous Income" and click REVISIT
2. Now scroll down to the VERY LAST option "Other reportable income" and click Start

3. Type "Notice 2014-7" and the same amount you entered before but as a NEGATIVE (put - in front of the number) 

    

   This NEGATIVE number should show on your 1040 line 8 

Go through the return and answer any questions regarding the IRA contribution.