topic I filed my taxes and then amended to check box for difficulty of care federal income tax exemption. Should it have changed my state tax too? in After you file

I filed my taxes and then amended to check box for difficulty of care federal income tax exemption. Should it have changed my state tax too?

shaniaswan1998 — Tue, 10 Feb 2026 10:52:40 GMT

Difficulty of care federal income tax exemption

Re: I filed my taxes and then amended to check box for difficulty of care federal income tax exem...

Cynthiad66 — Sat, 24 Feb 2024 14:33:52 GMT

It depends on what state and county you live in. This tax-exempt income can be reported to you differently depending on the State and County you live in. You might receive a W-2, 1099, and no form at all. Normally, TurboTax will transfer the income to the state forms and handle it correctly based on the state you live in.

TurboTax can exempt income under Notice 2014-7 per the IRS instructions for Medicaid Waiver payments from IHHS. 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. Additionally, you can choose to use this income to calculate Earned Income Credit. Regardless, the income will remain non-taxable.

What state do you live or work in and receive Difficulty of Care payments?

Re: I filed my taxes and then amended to check box for difficulty of care federal income tax exem...

shaniaswan1998 — Sat, 24 Feb 2024 14:50:43 GMT

From Connecticut. We just changed payroll companies and they told me about disability of care exemption my W-2 is from the previous company so It is a regular W-2 I am eligible so I checked the box in TurboTax. Again this changed the federal tax and increased my state tax so I want to make sure this is correct

Re: I filed my taxes and then amended to check box for difficulty of care federal income tax exem...

shaniaswan1998 — Sat, 24 Feb 2024 15:17:42 GMT