You only pay income tax in your resident state for retirement income so if you never lived in North Carolina they cannot tax it. Because you worked in North Carolina, if you are required to file a nonresident state tax return you would be able to allocate the NC income in TurboTax. Note: North Carolina can include your 401k payout to determine your tax rate (percentage) but it can only apply that rate to the North Carolina income.
@Piggiesmom
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