IHSS Tax Exempt - Can't E-file with W2 having $0 in Box 1

[ZoomZoomZoom]

I have a similar problem. I worked in a different state and received two W2s.

* The first has Box 1 (fed withholdin) & box 15&16 (state withholding) for Calif.

* The second has nothing in Box1, and has Boxes 15&16 for MD.

Turbotax doesn't let me file. Should I delete the second W2 to file Federal then add it back in when filing state?

[JohnB5677]

Your employer issued you 2 W-2's because you had multiple states.

You should include the second state on the original W-2.  this will resolve the problem.

@ZoomZoomZoom

[mschaub]

I have a W2 where box 1 (wages and tips) is $0.01 and box 16 (state wages) is $596.88; ALL other boxes are 0 including medicare taxes.   Does that mean I don't need to enter this W2?

[LeonardS]

If your income is exempt IHSS wages and no federal or state tax was withheld then you do not need to file a tax return.  If federal and or state tax was withheld you may want to file a tax return to receive a refund for the taxes withheld.  In that case, enter $1 as wages on your W-2 for your IHSS income this will allow you to proceed and not impact your tax return.

@mschaub

[smallshrimp]

This is April 2022. I just tried using the enter $1 in Box 1 trick to e-file. TurboTax allowed me to submit to IRS. But the validation immediately failed on the IRS side. Apparently, matching Box 1 in W-2 is a test in the IRS validation. So the $1 method doesn't work. I am left with filing my return with mail.

[Davalos86]

I claimed my wages that they put on box 3 n was investigate by the irs because i claimed the stimulus i had already received n since they didn't hear from before the date on the letter they send my taxes to Audit department request proof of income cus it shows 0 on line 1 n 2 if it wasn't for that stimulus i would off been lucky but no mow waiting to see what they say by submitting my last check stub it instead n proof that i had always filed the same amount of wages

[Nero1]

I'm trying to file my 2021 return, and I have the same question. What has worked for anyone in this situation? I'm trying to avoid having to mail in my return. I'm trying to make the 10/17/22 extended deadline, too.

I have $0 for wages because I'm a live-in provider. But Box 3-6 have numbers in them, and they're for Social Security & Medicare wages & tax withheld.

Can I use the $1 method? Can we offset the $1 elsewhere so it can successfully e-file? 

[VolvoGirl]

You don't have to enter that W2 at all.  Delete it.  Do you have other income?  You may not need to even file.  If you want to efile you can enter $1 of interest.  Make up a fake 1099INT.  It won't be taxable but should let you efile.  

[Nero1]

Yes, I have some INT and some rental income. There's Medicare & Social Security wages/taxes withheld, and I believe I need to report that in order to get a refund. 

[VolvoGirl]

No SS and Medicare don't affect your tax return.  

[waver368]

thanks for the info.... I'd a regular job and ihss with w2 box1 for my mother living with me and I'd extra social  security tax withheld.... looks like I might need to file in by mail sigh.

[Lance676]

Everyone keeps saying to remove it but when I do, even though boxes 1 and 2 are zero my Federal return amount drops significantly.  Why is that?  Is it based on the SS and Medicare tax withheld?

[CatinaT1]

The entry for IHHS income changed this year. You will enter your W2, even though it shows $0 in box 1. This will also allow you to claim earned income credit in California. 

TurboTax can exempt income under Notice 2014-7 per the IRS instructions. 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. You can choose to use this income to calculate Earned Income Credit. Regardless, the income will remain non-taxable.  

    

This is how you will enter your W2: 

1. Sign into TurboTax Online, click Continue your return, then pick up where I left off (if you are using TurboTax CD/ Download, then just open your return on your computer);  
2. Click on Federal from the menu on the left-hand side and then click on Wages & Income at the top;  
3. Click Edit/Add next to Job (W-2);   
4. click on Add a W-2; and enter the information as reported on your W-2.  
5. After you have entered all your W-2s, you will see a screen that looks like this, asking for uncommon situations. Make sure you check the box for Nontaxable Medicaid waiver payments.   

You will then get to choose whether you want to include the income for Earned Income Credit.  

For more information, refer to IRS Notice 2014–7, 20144 I.R.B. 445 and the IRS FAQs.  

[smallshrimp]

I just tried it and my CA tax refund went up on my tax return. Awesome! Thank you!

[Lance676]

Yes, I also noticed that for California taxes