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How to exclude Medicaid waiver payments from income in ProConnect Tax

by ProConnect Tax Online Updated 7 months ago

Follow these steps to report qualified Medicaid waiver payments excludable under IRS Code Section 131 per Notice 2014-7:

  1. Go to the Input Return tab.
  2. On the left-side menu, select Income.
  3. Select Wages, Salaries, Tips (W-2).
  4. Enter all information as reported on the W-2.
  5. On the left-side menu, select SS Benefits, Alimony, Misc. Income.
  6. Enter the excludable amount in the one of the following boxes:
    • Nontaxable medicaid waiver payments to care provider to include earned income that were not reported on W-2, Box 1
    • Nontaxable medicaid waiver payments to care provider to include earned income that were incorrectly reported on W-2, Box 1

The amount you enter will flow to Schedule 1, line 8s.

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