w2's

[Grimaldo1975]

my wife's w-2 form 

show's 0$  wages  in box # 1 

she didn't have no state or federal taxes deducted, her choice 

she cared for her late grandma as a care taker 

she only worked 6 month's 

[Hal_Al]

Who was the employer that issued the W-2?  What was in boxes 3 & 5?

[JohnB5677]

We'd love to help you complete your tax return but need more information. Can you please clarify your question?

• Are there any entries on the W-2?
• What are they, and what boxes are they in?
• Did she actually get paid?

[Grimaldo1975]

her grandma

amounts in boxes 3 & 5 are 10481.47

[Grimaldo1975]

yes she was paid for 6 months

box 1 0$

Box 2  0$

box 3  $10481.47

box 4   $649.85

box 5 10481.47

box 6 151.89

[Hal_Al · Accepted solution]

It appears that you have a "Difficulty of care" payment, which is not subject to income tax, but is subject to FICA (social security and medicare tax).

You can enter the W-2, exactly as received and it won't be taxed.

But, if you want it to count for the earned income credit and/or the child tax credit, enter  $10,481.47 in box 1 at the W-2 screen.  You will later take a deduction for that amount.

2022 New this year:  The IRS has provided a place to deduct (line 8s of Schedule 1) the nontaxable income (but still allow you to claim the Earned Income credit based on that income).

TurboTax now smoothly handles it (it was complicated in previous years). At the end of the W-2 screens, you will encounter a screen titled "Let's check for uncommon situations". Check the box at "Non taxable Medicare waiver payments that qualify as difficulty of care payments". On the next screen, indicate the amount ( $10,481.47).

Reference: 

 https://www.irs.gov/Individuals/Certain-Medicaid-Waiver-Payments-May-Be-Excludable-From-Income

[Grimaldo1975]

thanks for info