I know over in TurboTax they say to put both the W2 income and the adjustment on Line 21.  Then you'd need to include the withholdings on the tax payment worksheet.

But I've seen in here, people input the W2 as usual, then on the EIC worksheet, classify it as "halfway house" income so that the EIC wont compute, and back it out on Line 21 with the IRS Notice 2014-7 exclusion.