"isn't the whole point of using TurboTax that we don't have to have to use worksheets or figure out ourselves how to avoid double taxation? Isn't that what TurboTax is supposed to do?"
Welcome to TurboTax.
TurboTax has chosen to present the question in a manner that differs from the NJ worksheet. The result should be the same.
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I did answer that: your inherited IRAS have to be treated separately.
Therefore the total value is the value of the inherited IRA.
To get the correct result (no recovery amount on Line 20b) Enter a prior unrecovered contributions value of zero. Or a total contributions value of zero.
This depends on how TurboTax 2020 does it. I don't have the program for this year to try it out for you.
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Now that you reside in NJ, if you make contributions to your own IRA. you should keep accurate records of the amounts.
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The option to recover your contributions was added to the NJ Tax code around 2013. Before that, you were double taxed on your distributions, but after that time, you could begin to recover that, using the worksheet, if you lived so long.
generally, you can't recover all the basis until the IRA is exhausted.
