Thanks @GeorgeM777 that was a very helpful explanation, I understand and think I can parse through the forms now with a follow-up for you, as I think there is a problem. Here is what I am seeing (this is actually my mom's return that I am doing for her):
TT reports a pension exclusion on line 10, form 502, of $15,665.
That comes from this -- on the Maryland 502 Pension Exclusion Computation Worksheet generated by TT, line 2 is the $34,300 max exclusion you referred to. Line 3 is $18,635, her total Social Security benefits. So line 4 shows an exclusion of $15,665, reported on the 502 line 10. If I understand correctly, that amount is a valid exclusion BECAUSE line 1a on the Maryland 502 Pension Exclusion Computation Worksheet - "Qualified pension and retirement annuity included in Fed AGI" is $18,105. This comes from 2 annuities reported on 1099-R's on the Federal return.
BUT! The $18,105 is not correct, if I understand what you explained! This amount comes from two annuities as I wrote above, but they are CHARITABLE GIFT annuities, and they are most certainly NOT from an "employee retirement system"! Both hard-copy 1099-R's reported show Box 7, "Distribution codes", of "F" - which is "Charitable Gift Annuity" - and that is what they are. Both 1099-R's in TT, Federal forms list, do show the "F" for each. So shouldn't line 1a be $0, and there be no Maryland Pension Exclusion? It appears TT is taking charitable gift annuities and using them for a possible pension exclusion.
Thanks for your review of this!
