Where do I enter the California 1099 MIsc for the MCTR I received?

To report on Federal >Income >choose what I want to work on >Other common income >1099-misc>other income. Report the Middle Class Refund and follow the prompts. 

On California section you will see HERE’s INCOME THAT CALIFORNIA HANDLES DIFFERENTLY. Scroll down to Miscellaneous and scroll down to MIDDLE CLASS TAX REFUND and follow the prompts to exclude the income from CA. 

Thanks for the accurate reply!

I wish the IRS would make a ruling on this topic!

When will the IRS make a ruling and how will I know??

Unknown. If there is no ruling that the payment is exempt it means it is taxed. 

we’re your returns accepted? 

I have not filed yet, waiting for IRS and their ruling. 

Now excluded from federal and CA taxes!

Is this verified via IRS or news?

This is for IRS, 1099 MISC.  Turbo Tax help line said they are waiting for the ruling from IRS, if they will be counting as income or not.  I think it should be a NO!

It should be not taxable for federal but doesn’t matter right now as a lot of e-files getting rejected due to the MCTR and waiting on an update?

My return was rejected and I am getting error. CA_MCTR Payment 

Are you seeing the same error?

I would imagine that when it becomes official from IRS either way, Turbotax will issue an update?

Since we have no actual written authority from the IRS as of now, and this is a refund of California (CA) tax which would have been considered income earned and taxed previously, i.e., refund of tax, it should not be taxable unless you specifically deducted tax through itemized deductions in a prior year.

Our tax expert @VolvoGirl has also provided additional guidance specific to your question:

• 'There was a new Turbo Tax program update yesterday on Jan 26, 2023.  The CA MCTR is now not taxable for federal and state.  When you enter the 1099Misc box 3 it should ask ....Do any of the uncommon situations apply?  And in my Desktop program the 3rd item listed is California Middle Class Tax Refund. 
• When you click on that then at the bottom it will say....The California Middle Class Tax Refund (MCTR) will not be taxable on your California or federal returns.

@Iharthur12

Have you tried e-file and did it go through?

I updated Turbotax as indicated but my program does not say anything about uncommon situations etc in the MISC INCOME section...

I deleted my entry for the 1099 MISC I got from California State Franchise Board but it kept coming back so I changed to forms and entered it on the form directly and it seems to have accepted it that way.

Any other suggestions before I attempt to file?

Thank you

Not yet, waiting to make sure all is correct!

Thank you, yes, that took care of the problem.  Have a great day.

Can you detail where to enter the information? I have deleted it and cannot find where to enter it in the form directly 

@mrshikerrose 

I just tried this and marked that it was for my MCTR and it was still rejected.

I'm just going to try again on Monday.  Maybe they will get it together.  I'm not holding my breathe.

Try this.....

Be sure you did the program update from yesterday.

Open your return.

Click on view at the very top of the program and click on forms.

Scroll down the list of forms on the far left and click on form 1099 MISC to open it.

Fill in the details from your 1099 MISC from CA at the top

Then go down to Box 3 and enter the amount you received on the first line and then at the bottom line check YES where it shows California Middle Class Tax Refund.

Finally at the very bottom of the form enter the address for the payer (CA Franchise etc)

When done go back to step by step and complete the rest of your return and state return.

Hope it works for you.....

Did it work for you? 

For the state, I dont see the Middle Class Tax Refund under miscellaneous again. Can you advise on out to input the details for state

Yes, it did work.  I have not filed yet, waiting for 1 more document.

The same thing is happening to me. One minute the Middle Class Tax Refund button was there under Miscellaneous, but when I went back the button was gone. Very frustrating!