Welcome back! Ask questions, get answers, and join our large community of tax professionals.
cancel
Showing results for 
Search instead for 
Did you mean: 

Difficulty of Care on W-2

taxladyworking
Level 3

I have a client who has received a Difficulty of care payment on a W-2 each year for the care of their son with box 1 and box 2 zero and there is always an amount in box 16 and 17. I have always had them file paper because Proseries does not accept zeros when entering the W-2 for e-file purposes. And since Oregon accepts Federals exemption, they have always received the amount in box 17 back.

My question is since we now have the Medicaid waiver payments that can be entered on Line 1d of the Form 1040 and the ability to subtract it out on Schedule 1, Line 8s,  how do you get around the W-2 with zeros in box 1 and 2 when entering it in the W-2 worksheet so you can file the return electronically? Any suggestions is appreciated.

0 Cheers
12 Comments 12
Just-Lisa-Now-
Level 15
Level 15

You could put $1 in Box 1 to trick the system into letting your EFile it.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
taxladyworking
Level 3

I thought about that, but then checked into it and was told that it was not a correct filing if I did that since the amount you would reflect on the Form 1040 would not match the difficulty of care payments received and shown on the new MWP lines. Therefore, I'm pondering how to trick the system in another way so that it keeps the amount I'm subtracting back out the same as what is reflected in the Oregon box 16. 

0 Cheers
Skylane
Level 11
Level 11

Put $1 in wages then override line on 1040 and disable error checking when efiling?

If at first you don’t succeed…..find a workaround
0 Cheers
taxfaks
Level 3

You could also try putting .01 since it will round anything less than .50 down to zero anyway.

HOPE2
Level 9

@Just-Lisa-Now- 

If I put $1 on box 1, client gets $2 refund as EIC, what can I do?. Client not eligible to take any refund in fact.

Thanks for help!

0 Cheers
HOPE2
Level 9

@Skylane 

I did but still did not go through!

Thanks for your help

0 Cheers
taxfaks
Level 3

@HOPE2 I found this info regarding the W2 situations for the difficulty in care paymnts. It tells you how to entee when there aren’t amounts in box 1 & it has screen shots. Here’s the link; https://www.goladderup.org/wp-content/uploads/2020/03/ProSeries-Entering-Medicaid-Waiver-Payments.pd...

0 Cheers
taxfaks
Level 3

@HOPE2  It starts on page 3

0 Cheers
taxfaks
Level 3

@HOPE2  It also states the taxpayer can inlcude the medicaid waiver paymnts as earned income to claim the EIC

0 Cheers
Just-Lisa-Now-
Level 15
Level 15

You dont enter that W2 on the return.   

If the income does qualify them for EITC, theres a place on the eic worksheet to input it, but you dont enter the W2.

If the SS withheld exceeds the annual limit (when added to other earned income), then you may have to do something to get that excess refunded, but Ive never had anyone that this applied to, so Ive never looked into it.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
0 Cheers
Just-Lisa-Now-
Level 15
Level 15

the only reason I mentioned the $1 above, was becasue Oregon was involved and I wasnt sure how they handled it.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
0 Cheers
HOPE2
Level 9
0 Cheers