The IRS has decided to exclude $662.19 for tax purposes from the Alaska PFD for Energy Relief Payment. How should I treat this?

[jonethoh]

Should the AK PFD 1099-MISC be changed?

[JohnW152]

No, your Form 1099-MISC shouldn’t be changed.

You’ll need to enter your Alaska Permanent Fund Dividend in TurboTax, then make an additional entry to reflect the supplemental Energy Relief Payment.

First, if you haven't yet entered your Permanent Fund Dividend, please see the TurboTax Help article Where do I enter my 2022 Alaska Permanent Fund Dividend (Alaska PFD)? for guidance.

Once that's entered, you need to make an adjustment for the energy relief payment.  To do this in TurboTax Online:

1. If you don’t see 2022 TAXES in the left pane, select the dropdown to the right of Income & Expenses on the Hi, let’s keep working on your taxes! page and then select Let’s get started, Pick up where you left off, or Review/Edit. 
   • Otherwise, in the left pane, select Wages & Income
2. Scroll down and select the Show more dropdown to the right of Less Common Income
3. Select Edit, Edit/Add or Revisit to the right of Miscellaneous Income, 1099-A, 1099-C
4. On the Let's Work on Any Miscellaneous Income page, select Start or Revisit to the right of Other reportable income
5. On the Any Other Taxable Income? page, select Yes
6. On the Other Taxable Income page, enter Energy Relief Payment in the Description box, and enter your adjustment amount as a negative number (i.e., -662), then select Continue

See the IRS article IRS issues guidance on state tax payments to help taxpayers for more information.

[cchase907]

The problem with TTs article about the pfd this year is that they literally say to enter 992 in Box 3. That's... An amount I can't seem to find any rationale for. Here is their article https://ttlc.intuit.com/turbotax-support/en-us/help-article/import-export-data-files/enter-2021-alas...

I thought we would just report the amount less the energy relief payment. I see your breakdown of putting the full amount from box 3 and entering in the relief payment elsewhere. I'll take a look at that. 

But I'm still confused why TTs own article says to enter 992 for box 3.... :S

[ErnieS0]

$992 was the amount of the 2020 Alaska Permanent Fund dividend. The 2022 Permanent Fund Dividend amount is $3,284. The Energy Relief Portion is $662.

As awesome Tax Expert JohnW152 says, enter the full amount ($3,284) under Form 1099-MISC and then enter a subtraction for the Energy Relief Portion.

To enter your Alaska Permanent Fund dividend:
 

1. Type 1099-misc in Search (magnifying glass) in the top right corner
2. Tap Jump to 1099-misc
3. On “Did you get a 1099-MISC?” tap YES
4. Enter your info on “Let's get the info from your 1099-MISC” and put the PFD amount in Box 3, then Continue
5. On “Describe the reason for this 1099-MISC” write Alaska Permanent Fund Dividend, then Continue
6. On “Does one of these uncommon situations apply?” select This was an Alaska Permanent Fund dividend distribution, then Continue

To enter your Energy Relief Payment
 

1. Click Federal in the left column
2. Click Wages & Income 
3. Scroll down to Less Common Income. Tap Show more
4. Select Miscellaneous Income, 1099-A, 1099-C
5. Select Other reportable income
6. Say Yes to Any Other Taxable Income?
7. Enter a description (Energy Relief Payment) and amount (-$662). Make sure this amount is negative.

[David-42]

following @ErnieS0  suggestion (in the desktop version of the TT application), on these screen where you enter -662, there is a warning that reads "Do not enter income reported on Form 1099-MISC" which seems to conflict with the advice provided

[JamesG1]

The directions of @ErnieS0 are correct.

It is disconcerting to see the statement "Do not enter income reported on Form 1099-MISC".

But the intent of this entry is to correct income by a reversal entry.

The intent of the statement above is a general admonition  to direct the entry of income toward the Other Common Income options where Form 1099-MISC may be found rather than using the Less Common Income options.

@David-42