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joe-decker86
New Member

How do I remove combat pay election from my earned income? I included it to try to get the EIC, but since I don't qualify, I don't want it to be included as earned income

 
3 Replies
SusanY1
Employee Tax Expert

How do I remove combat pay election from my earned income? I included it to try to get the EIC, but since I don't qualify, I don't want it to be included as earned income

You don't need to make any changes.  When you make the election to have it considered earned for the credit, it doesn't change the nontaxable status of the pay. 

 

TurboTax only considers that income for the credit. 

 

If you would prefer to update the answer anyway here are the steps:

 

  1. Type in the term earned income credit in the Search tool.
  2. Click on the Jump to link in the list.
  3. Revisit the Earned Income Credit questions and update your answer for "Do you want to include nontaxable combat pay?" to No.
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joe-decker86
New Member

How do I remove combat pay election from my earned income? I included it to try to get the EIC, but since I don't qualify, I don't want it to be included as earned income

Thank you for the reply.

 

When  I followed the steps you laid out, all I see is "

It turns out you don't qualify for this credit
 
That's OK. We'll keep looking for other tax breaks for you."
 
There's no revisit option that I'm seeing. 
SusanY1
Employee Tax Expert

How do I remove combat pay election from my earned income? I included it to try to get the EIC, but since I don't qualify, I don't want it to be included as earned income

I'm sorry that it didn't work for you.

 

As long as you have the pay listed with the code "Q" in Box 12 of your Form W-2 entry screen, TurboTax will not include the amount in your income.

 

Here is another way to see that your combat pay is not taxed.

  1. Click on Tax Tools in the menu bar on the left of the screen.
  2. Click on Tools.
  3. Click on View Tax Summary.

Here you should see that your nontaxable combat pay is excludedfrom your total income and taxable income.  (You may need to add a few numbers from your W-2s to check this.)  

Thank you for your service!

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