California's Middle Class Tax Refund is a federal income?

Do we just ignore the California Form 1099-MISC or do we still report it and then use a negative entry to back it out?

The IRS news release says that taxpayers need not report the payment on the return. However, if the amount was $600 or more, and the taxpayer received a 1099-MISC, then I believe it would be prudent to report the amount on Form 1040, Schedule 1, line 8z, then back it out on line 24z with the explanation "General welfare exclusion per IR-2023-23."

The problem is, who has actually received a 1099-MISC? So far, half of the people told me they received a 1099-MISC and the other half said they did not. Then half of those who said they did not probably might have received it but either got it misplaced or the form got lost in the mail. So where do you draw the line to report the payment and not to?

$600

That might not be where a good line to draw because some taxpayer who received $350 mctr also got a 1099.

We have seen no 1099s for less than $600 and many for $700 or $1050. We have been reportling all MCTRs and netting them out as suggested by NoCal above. So glad we do not need to go back and redo all the completed returns that are waiting for pickup!

https://www.irs.gov/newsroom/irs-issues ... -taxpayers

Then half of those who said they did not probably might have received it but either got it misplaced or the form got lost in the mail. So where do you draw the line to report the payment and not to?

You ask for the amount which they can find from their bank account, and report as if they have received the 1099-misc form.

David Fogel, a previous, greatly missed, contributor to this board and considered by many to be a gifted interpreter of IRS scripture has weighed in on this and agrees that a stong agrumenet can be made for it to be considered non-taxable income.

https://img1.wsimg.com/blobby/go/310b78 ... 4313102340

Fogel helped my office on a difficult client matter years ago and was a pleasure to work with. I found your post because I was trying to look him up again.