CORRECTION: SEE NEW REPLY BELOW.
The payment should be entered (as a positive number) as an "other adjustment" on Schedule 1 line 24z.
If you are using the TurboTax desktop software, go to forms mode and open the "Form 1040 or Form 1040-SR Worksheet" (abbreviated 1040/1040SR Wks). Scroll down to Schedule 1, then to Part II, Adjustments to Income, at the top of page 5 of the worksheet. Scroll down a little more to the "Other Adjustments to Income Smart Worksheet" between lines 23 and 24. On line G of the Smart Worksheet, enter a short description in the box on the left, and enter the amount on the right. The description and amount that you enter will appear on line 24z.
There is no way to make this entry in TurboTax Online. Because of that, you may have been advised to enter it as negative miscellaneous income because you were using TurboTax Online.
Here's what a TurboTax expert wrote about this a little over a year ago.
"Ideally, the subtraction for the amount you paid to your ex-spouse would be reported on Schedule 1, Line 24z - Other Adjustments.
"If using TurboTax Desktop, switch to Forms Mode and on the 1040/1040SR WKS, look for Other Adjustments to Income Smart Worksheet, Line G and enter Nominee 1099-R and the amount (as a positive value).
"TurboTax Online does not currently support this. Instead, you would need to enter it as Other Miscellaneous Income with a negative amount. Within the Miscellaneous Income, Other reportable income topic, answer YES to the question that asks Any Other Taxable Income? Enter 1099-R Nominee and a negative amount. It's going to be reported on Schedule 1, Line 3z - Other Income (as a negative). Not ideal, but accomplishes the reduction of your total income.
"Beware, if you have a state return that provides special treatment for retirement income, make sure it's not excluding / subtracting more than your portion of the DFAS 1099-R amount. This may require overrides using TurboTax Desktop."
