How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask TaxRobin Your Own Question
TaxRobin, Senior Advisor
Category: Finance
Satisfied Customers: 15605
Experience:  15 years of experience in financial advising with emphasis on tax issues.
Type Your Finance Question Here...
TaxRobin is online now
A new question is answered every 9 seconds

I am my daughters Individual Care Provider in the state of WA. I was

Customer Question

I am my daughters Individual Care Provider in the state of WA. I was recently made aware that under Tax Code 131 payments I receive are considered "difficulty of care payments" and are excluded from Fed Tax payment. I did read the code and that does sound correct. How to I file the income received on my tax return. I use Turbo Tax. And can I do , and how do I do an amendment as it was effective for payments received on or after 1/2/2014
Thank you
Submitted: 1 year ago.
Category: Finance
Expert:  TaxRobin replied 1 year ago.
HelloIf this was reported to you in Box 3 of Form 1099-MISC and you choose to apply the IRS Notice for NonTaxable to payments received in 2015, you would not include the payments on Line 21. If you are filing electronically, do not report the Form 1099-MISC. If you file a paper return, write "Notice 2014-7" to the left of Line 21. You would do the same for amending.You can amend a prior year in TurboTax and remove the 1099MISC. In the reason section for changes you list "Notice 2014-7"You are required to click a positive rating if I am to be credited with the response.You have to actively click on a rating and click submit. Smiley Faces or Stars.
Customer: replied 1 year ago.
Your answer addressed 1099MISC. I received a W-2 form NOT a 1099 MISC. Does that mean I do not qualify for the tax exemption in Tax Code 131 under "difficulty of care payments"for being my daughters Individual Care Privider because I received a W-2 NOT a 1099MISC???
If I do qualify having received a W-2 how do I capture the exemption using TurboTax for 2015. How do I do an amendment for 2014 with receiving a W-2.
Expert:  TaxRobin replied 1 year ago.
Thank you for adding that.You would enter the W2 as usually but you will also report the excludable amount as a negative adjustment on Form 1040, Line 21.This will subtract the wages form the income on the 1040 form.You would enter "Notice 2014-7" on line 21 as the description
Expert:  TaxRobin replied 1 year ago.
The amendments will work the same. You will just need to "add" a negative entry on Line 21 as "Notice 2014-7"