State tax filing

In the TurboTax software, please make sure that you picked the correct classification in the software if your 1099-R is fully exempt. 

Your pension income is not taxable in New York State when it is paid by:

• New York State or local government
• the federal government, including Social Security benefits
• Certain public authorities

I created a married filing joint mock-up return in the TurboTax computer software (not the online version). I went through the on-screen questions for two 1099-R's, one for each spouse. Depending on the classification entered for the 1099-R distribution, it automatically calculated the exemption on the NYS Pension Deduction Summary. One spouse got the full exemption and the other showed a $20,000 deduction. Both took the required minimum distributions (RMD's). 

Please follow these steps and make sure all the required fields are completed:

1. Open your return.
2. Click on Personal Income, under the Personal tab.
3. Click Edit next to the 1099-R you want to correct.
4. Enter the information as shown on your 1099-R. 
5. Answer the questions on the next two screens.
6. Make sure the correct source of your 1099-R is selected. In addition, keep the NYS distribution amount as the full pension distribution. It will be shown as deducted fully on a later screen.
7. Click on From a qualified plan on the screen Was this distribution from a qualified plan?
8. Answer the required minimum distribution questions on the next screen.
9. Finish answering the questions about your 1099-R.
10. Once you are back to your federal 1099-R summary screen, click on State Taxes tab above. 
11. Click on Edit for New York.
12. The next screen should be your pension summary screen and will show your pension fully deducted.

I have attached pictures for further guidance from my mock-up return. 

@ro96