I believe TurboTax has an error in the Massachusetts Form 1. The error is regarding nontaxable Military pensions. The Mass tax code indicates the following. “US Military pensions, which are included in Federal Gross income, are excluded from Massachusetts gross income”. Upon examining the TurboTax Form 1, it shows the pension dollars in the Pensions and Annuities Smart Worksheet. By choosing the “Type” box and clicking G, it should make it Tax exempt. Going down to Line 4 the pension amount is still included as Taxable by including it in gross income. Referring to line 37 the tax due includes the taxable portion for the Exempt pension. Therefore, the Military pension is not excluded from Massachusetts gross income IAW the Massachusetts tax code.
