How do I fill out tax return to be able to e-file and get EIC if my W-2 has $0 in box 1 because I am live-in IHSS provider that is paid in Medicaid waiver payments which are tax exempt

[E-Rich333]

 Hello, I have been trying to file my 2024 tax return using free edition of TurboTax, since I’ve been having problems getting it to let me E-file because of the $0.00 amount in box 1 of my W-2, I am now down to the April 15th deadline unfortunately🫤 so I would very much appreciate anybody who can help me with this problem before 12(Midnight) tonight on the west coast….

•  The problem I am having is TurboTax won’t let me E-file because my W-2 has a $0.00 amount in box 1 because I am a live-in IHSS provider which makes my income non-taxable because I am paid in Medicaid waiver payments. I do realize this means I don’t have to file a tax return but I am filing to get the federal and state (CA) Earned income tax credit, because I can use my Medicaid waiver income to calculate my EIC. I have done hours/days of research online and in the intuit website FAQ’s section which has quite a bit of people asking this same question and tax experts answering. The only problem is there is so many different conflicting answers and methods of going about filling out my return, I am honestly confused and not sure which method to go with? I was really hoping somebody could give me a definitive, confirmed to work method. I have read the one method saying to just put $1 in box 1 so that it will let me E-file? I’m uncertain of doing that though because that’s not what my W-2 says and I’m afraid I.R.S will reject it? Another method says to just put the amount in box 3 of my W-2 which is the amount I received in Medicaid waiver payments, in box 1. then in the     (UNCOMMON SITUATIONS) section, click the box that says “MEDICAID WAIVER PAYMENTS” Some people had a problem with that method saying it counted their income twice? Then someone said to enter that amount in as a negative number somewhere else in the form and then it would subtract it on line 8 of my 1040 form or something like that?? And the last method I read was to leave the $0.00 in box 1 and then go down to the section where it says (Other types of income) and select “MISCELLANEOUS INCOME” then enter my Medicaid waiver payments amount there and then type in the box to explain what it is (“Medicaid waiver payments”) Again, I sincerely appreciate your time and effort on this subject. Hopefully together we can figure this out before the deadline at midnight tonight. I really could use the extra money right now from the EIC to pay some bills😊

[SharonD007]

If the only entry on your W-2 is in Box 12 (there's a blank or a $0 in Box 1) and you don’t want to use the income to qualify for Earned Income Credit or Additional Child Tax Credit, you don’t need to enter the W-2 at all.

When your W-2 has zeroes in all of the boxes except Box 12a, with code ll, that amount is your Medicaid Waiver Payments that are excluded from your income. To determine if you want to include this income on your tax return for your Earned Income Tax Credit, when you get to that section, you can elect to add the income or exclude it.  Try both ways to determine which way gives you the greater EIC.

Follow the steps below to enter your W-2

1. Open TurboTax
2. Select Federal Taxes
3. Select Wages & Income
4. Select Work on W-2
5. Enter your W-2, at the Let's check for uncommon situations; check the box next to Nontaxable Medicaid waiver payments
6. Continue following the prompts.

Review the TurboTax Help article How do I enter my tax-exempt Medicaid waiver payments from IHSS in TurboTax? for navigation instructions.