One follow-up question as it relates specifically to this situation for PA taxes. During the Pennsylvania interview, it asks what kind of retirement income I'm receiving from my brokerage. I choose Traditional or Roth IRA: i'm under 59.5.
It asks for gross distribution and basis for each., with Gross distribution pre-filled as 12,000 each.
My question: Similar to Federal, do I also enter 6,000 as my basis for state retirement income? (because I made 6k contribution to traditional IRA for 2020?) It's a bit more confusing because the tooltip mentions using "Cost recovery method".
It appears this reduces my state taxable income by ~12k (6k for each), so just want to ensure this is the correct way.
Thanks,
