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

[shykumar]

Hi there - I have the downlable version. I deleted the W-2 and re-entered everything once again (I have done this step a few times now). It still comes back with the same error. Multiple people on this thread are having the same problem so I think there is a bug/issue with TurboTax and should be fixed. It's a hassle to print and mail the forms now. Thanks for your help.

[MonikaK1]

In your Federal return, enter the W-2 and be sure you are using the steps outlined by @CatinaT1 above.

You may have missed Step 6, entering the amount of your IHSS payments, as reported in Boxes 3 and 5 on your W-2. 

These steps also apply to the download/desktop version. 

If the IHSS W-2 is the ONLY income you have on your return this year, then you may need to enter $1 instead of $0 in Box 1 in order to e-file so that there is an Adjusted Gross Income amount on your return.

[shykumar]

Thanks - Yes, the amounts in Box 3 and 5 have been entered (the W-2 form is filled exactly as what was sent) - and this is not the only W-2 in the return. Nothing is working and the error still shows up.

[MonikaK1]

See the instructions below for how to report this depending on how the income was reported to you.

If you received a W-2 with $0 in Box 1:

1. Sign in to 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 Taxes, and then click on Wages & Income;   
3. Under Wages and Salaries, click Edit/Add next to Form W-2;    
4. Click on Add a W-2, and enter the information as reported on your W-2.   
5. After entering all your W-2s, you will see the screen, Let’s check for uncommon situations. Next to Nontaxable Medicaid waiver payments, check the box.
6. You will enter the amount of Medicaid Waiver Payments into the box asking for the amount of difficulty of care payment you received from IHHS. This will be the same amount reported in Boxes 3 and 5 of your W-2.
7. When you get to the Earned Income Credit section under the  Deductions and Credits portion of your return, you will be asked if you want to add your Medicaid waiver payment to your income for this credit. You can try it both ways, including it and excluding it from the calculation for the credit and see which way benefits you most.

Step 6 in the process( provided by CatinaT1 above) states that you will need to enter the amount from Box 3 / 5 of your W-2 into the box asking for the amount of difficulty of care payment that you received from IHHS. 

This process is working for other users. If you follow these exact steps and you are getting an error, you may have a different issue. If so, please provide specifics as to what the error message shows.

[shykumar]

I followed all the steps exactly as you have listed them above. I re-did teh entire thing again just now and still get this error message :

[DawnC]

Did you put a checkmark in the 'Medicare waiver payments' box in the W-2 follow-up?

@shykumar 

[shykumar]

Yes I did

[shykumar]

Not sure what the problem is at this time. feels like I've done and re-done the steps multiple times with the same end result. My only option now seems printing and filing.

[DawnC]

Please review this help article to determine what steps are needed for your situation.   If you have a 0 in Box 1, you can't subtract the Box 5 amount in the follow-up.   Qualified Medicare Payments.  

[shykumar]

I believe the problem is the$0 in the Box 1. The second step - "If these payments are incorrectly paid to you in box 1 of a W-2" is not valid for me since the amount in Box 1 as $0 is correct.

[smallshrimp]

Yes. I saw my refund adjusted up, so that check box worked. I just didn’t try changing back the $1 in box 1 and efiled with that. And it went through. So it may not be ideal but fine with me. I will try box 1 with $0 and the checkbox checked next year. Thanks!

[CatinaT1]

"If these payments are incorrectly paid to you in box 1 of a W-2" 

Those are old instructions. The entry changed this year. It is okay to have a W2 for Medicaid Waiver Payments with $0 in box 1 now.

I think you have missed steps #5 and/or #6.

• After entering all your W-2s, you will see the screen, Let’s check for uncommon situations. Next to Nontaxable Medicaid waiver payments, check the box.
• You will enter the amount of Medicaid Waiver Payments into the box asking for the amount of difficulty of care payment you received from IHHS. This will be the same amount reported in Boxes 3 and 5 of your W-2.

Can you verify if you checked the box and how you answered the amount of Medicaid Waiver Payments?

[shykumar]

Step 6 - You will enter the amount of Medicaid Waiver Payments into the box asking for the amount of difficulty of care payment you received from IHHS. This will be the same amount reported in Boxes 3 and 5 of your W-2.

In this step, I have entered the exact amount that was in Box 5, which is the Medicare Payments. 

[shykumar]

Yes - I checked the box and entered amount that was the medicare waiver amount.

[CatinaT1]

What about checking the box mentioned in Step 5?