Dixiefire53
Level 2

Turbo Tax is taxing my retirement income for the state of Mississippi. By state law, this is not state taxable income. Is there a box I missed?

 
DaveF1006
Expert Alumni

Retirement tax questions

Yes, you are correct. In fact, I tested this in my Turbo Tax program and it worked perfectly.  It may be an erroneous entry when entered your information into Turbo Tax. I would do all three of these steps to ensure your retirement income is excluded in Mississippi. 

  1. Delete the State of Mississippi in your tax return.
  2. Delete the 1099R in your return and then add it back.
  3. If the income is still not excluded, contact Tech Support at 1-800-446-8848.for further assistance as they can view your screen to pinpoint any issues you are experiencing.
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scottg29
Level 3

Retirement tax questions

I've tried steps one and two, didn't solve the issue.  I have had retirement income (Mississippi) for four years, used TurboTax each time.  Never had this issue in the prior three years.  

ReneeM7122
Level 8

Retirement tax questions

To get the Mississippi pension deduction, you will first have to enter the necessary information in your Federal Income tax return and then in the Mississippi income tax return.

Here are the steps to enter your exempt Mississippi employee pension:

 

On the  Federal Income Tax  portion:

  1. In the search or find box, type in 1099-R
  2. Click on Jump to 1099-R
  3. Scroll down to Retirement Plans and Social Security
  4. At IRA,401(k), Pension Plan Withdrawals (1099-R), click Start (or Update)
  5. Enter your 1099-R or if you have entered it, click on Edit then Continue
  6. Answer the next questions until you get to the Where Is This Distribution From? screen
  7. Select the source Mississippi Employees and enter the information requested:
  8. Click on Continue
  9. Click on From a Qualified Plan
  10. Continue answering the questions

 

On the Mississippi return portion: 

  1. At the Changes to Federal Income page, scroll down to Received retirement income, click Start (or Update)
  2. At the Retirement Distributions Summary page, click on Edit Mississippi
  3. If no additional information is required, click on Continue
  4. Click on Done

Review the Pension Deduction Summary for the deduction.

 

@scottg29

scottg29
Level 3

Retirement tax questions

Thanks for your reply.

However, on step 6, I never get the question "Where Is This Distribution From? "  screen.

 

Thanks.

dukes909
Level 3

Retirement tax questions

Same thing here; it is counting my PERS as income. I never see the "Where is this distribution from?"

BillM223
Expert Alumni

Retirement tax questions

@Dixiefire53

@scottg29

@dukes909

 

Are you using the TurboTax Online product or the TurboTax desktop product, and if desktop, which platform, Windows or Mac?

 

Or are you using the mobile app?

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dukes909
Level 3
BillM223
Expert Alumni

Retirement tax questions

@dukes909

 

As you can see, we are unable to reproduce this problem using the Online product. In addition to the following instructions, could you also add @ plus BillM233 (with no space in between) to the bottom of the reply so I will be notified? Thanks!

 

***

 

I'm going to need your help to get more information. Please send me a diagnostic file which is a copy of your tax return that has all of your personal information removed. You can send one to us by following the directions below:

***Online Product***

 

  1. Sign into your online account.
  2. Locate the Tax Tools on the left hand side of the screen.
  3. A Drop down will appear. Click on Share my file with agent.
  4. This will generate a message that a diagnostic copy will be created. Click on OK, the tax file gets sanitized and transmitted to us.
  5. Please provide the Token Number that was generated onto a response to this thread.

 

***Desktop Product***

 

  1. Click into your return.
  2. Click Online and select "Send Tax File to Agent".
  3. This will generate a message that a diagnostic copy will be created. Click on OK, the tax file gets sanitized and transmitted to us.
  4. Please provide the Token Number that was generated onto a response to this thread.
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dukes909
Level 3
scottg29
Level 3

Retirement tax questions

TurboTax Deluxe desktop edition,  windows.

BillM223
Expert Alumni

Retirement tax questions

The state says,

"

Is retirement income taxable?

​Generally, retirement income, pensions and annuities are not subject to Mississippi Income tax if the recipient has met the retirement plan requirements. Early distributions are not considered retirement income and may be subject to tax. ​

" See this MS page.

 

@dukes909

This addresses your issue.

 

@scottg29

Does this address your issue as well?

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dukes909
Level 3

Retirement tax questions

NO. It isn't an early distribution. It's a retirement pension from the state of Mississippi THAT IS NOT TAXABLE.

See: https://www.pers.ms.gov/Content/1099/Understanding_your_IRS_Form_1099R.pdf

"Retirement benefits are not subject to Mississippi State Income Tax"

I've used TT for 8 years and it has done this correctly each year. I'm sorry TurboTax has a bug in it this year.  H&R Block calculated it correctly, and I will use it this year.

@BillM223 

 

scottg29
Level 3

Retirement tax questions

Token number is  725770.

scottg29
Level 3

Retirement tax questions

No, it is not an early distribution.  This is state employee retirement.  I've used TurboTax for over 20 years at least, been retired for four years.  Past three years I've filed with retirement pay, no problems.  This is the first time I've had this issue with TurboTax.