IRS Notice 2014-7 Information Guide - Tax Exclusion for Medicaid Waiver Wages

Sep 19, 2026

This document provides critical guidance regarding IRS Notice 2014-7, which allows certain wages earned by employees providing services under Medicaid Waiver programs to be excluded from federal income tax. The content details the eligibility requirements, specifically focusing on employees residing with the individual receiving care, and notes potential applications to programs like PCA Choice or Consumer Support Grant. It addresses key implications of claiming this exclusion, such as the potential impact on Adjusted Gross Income (AGI) and associated benefits, while clarifying that it does not apply to Paid Time Off. Furthermore, it discusses the possibility of filing amended returns for previous tax years and updates regarding the Earned Income Tax Credit (EITC). Accra provides professional contact information for employees seeking verification of waiver-funded wages but explicitly states that its staff are not tax professionals and cannot provide personal tax advice. Readers are encouraged to consult official IRS resources for comprehensive tax compliance details.

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Understanding IRS Notice 2014-7

Eligibility and Application

Tax Implications and Considerations

Support and Additional Resources

FAQs

Who is eligible for the tax exclusion under IRS Notice 2014-7?

The exclusion applies primarily to employees who provide services to individuals on a Medicaid Waiver and live full-time in the home with the person receiving care.

Does IRS Notice 2014-7 apply to Paid Time Off (PTO) wages?

No, the tax exclusion provided under IRS Notice 2014-7 does not apply to wages earned as Paid Time Off.

Can an employee file for this exclusion retroactively?

Yes, employees may file an amended tax return for previous tax years to potentially benefit from the provisions of IRS Notice 2014-7.

How does claiming this exclusion affect eligibility for other benefits?

Reducing your Adjusted Gross Income (AGI) by claiming this exclusion may impact eligibility for benefits or insurance programs that are calculated based on a person’s AGI, such as TEFRA payments or health insurance.

Sep 19, 2026

Upload by Sophia Brooks