1099 tax exempt Medicaid wavier payments
hello
I’m trying to find the section where to put the information from my 1099 Tax exempt Medicaid wavier payments
Answers
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Hello,
Medicare Waiver Payments can be entered by going to Income → Other Income. If it is nontaxable, you can then enter the amount you would like to include in your earned income to help calculate certain credits.
If you received a W-2 reporting these, you will want to enter the W-2 first, and then go to the same spot as before (Income → Other Income) to exclude them from your taxes.
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But we got 1099s. So you’re saying don’t enter the 1099s under schedule C? There isnt a place to enter them in other payments unless they’re a w2. Furthermore, it wont let us claim them for credit without corresponding w2.
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Hello Shubbywax,
If you received a 1099-MISC or 1099-NEC for Medicaid Waiver payments, how you report them depends on if you have a business providing home care services or not.
FAQs 13 and 14 from the IRS on their page "Certain Medicaid waiver payments may be excludable from income" are relevant here.
Generally, you would enter the income from the 1099 on the Other Income section of the software as kiarab mentioned previously.
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I don’t have a business. I am a live in caregiver. I didn’t enter the 10-99 into the software anywhere. Other payments> Medicaid difficulty of care section did not have a place to enter a 1099. Maybe your platform should be updated to accommodate entering these kinds of 1099s (and not just reportable portions) payments in the future. I know in my state of TN they’re issuing 1099s for fmp/cls ( “Family Model Provider / Community Living Support”) homes. Thanks.
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Hi Shubbywax,
Thank you for the additional information. We have made a request to add tax support for these type of Medicaid Waiver Payments reported on a 1099-NEC or 1099-MISC. I recommend that you contact Customer Support directly to have a support agent look over your account and assist you on a way to enter that income.0 -
this is what Customer Support said:
Support 03/28/2026 3:22 PMHello,
Thank you for contacting customer support. You are correct, Medicaid Waiver payments are nontaxable. You generally would not enter these as a 1099-NEC, even if you received a 1099-NEC.
When you enter the 1099-NEC in our software and include it on a Schedule C, your income will be taxed inappropriately.
Instead, you can enter your Medicaid Waiver payments by going to Income > Other Income. You can find "Medicaid Waiver Payments to Care Provider" on that page. You can also choose to include the payments in your earned income without including them in your taxable income. This can sometimes increase your Earned Income Credit.
It looks like you've already submitted your return, so you'll have to amend if you need to make changes. To amend your return, click on the Account menu and select "Amend Tax Return." The software will walk you through the process from there.
Please let us know if there is anything else we can do to assist you.
Best,
Eliza
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Hi Subbywax,
It appears that you have a couple of Community threads going on. Which is pretty confusing. Continue to work with Customer Support to resolve your issues. Then post what your outcome is.0
