NJ taxed the money when you earned it so it is not taxable now.
1. You enter the 1099-R in federal.
2. You select that it was earned in NJ.
3. Where is this Distribution From? Select General Rule because:
If you made contributions to your retirement plan, it is a "contributory" plan. For New Jersey income tax purposes, you will use either the Three-Year Rule Method or the General Rule Method to determine the taxable part of any distribution you receive from a contributory plan other than an IRA. If you won't get all the money back within 3 years, choose general rule.
4. fill in the boxes under General Rule, continue
5. Select From a Qualified Plan
6. Continue through the program answering questions
When you go to the state, you will see Retirement Exclusion Summary. It will say certain retirement income on federal is NOT taxable by NJ.
@DAG3
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