- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Report Inappropriate Content
Retirement tax questions
Thank you for this information. I thought I would post the following in an effort to also help others asking about the same topic.
So, I went back to my NJ return and tried to enter the amount already taxed on my 401K figuring I would get the a similar screen like I get for my IRA accounts. But like a previous poster, I could find no such option. But there was a comment stating that exclusions were handled on the federal return. I thought this was a bit odd because the excluded amount only applied for my NJ state return and not my Federal return.
So, I revisited the 1099R form on the federal return and this time I carefully paid attention to all the pop up screens. There was one that asked to enter the taxable portion for NJ. It already populated that field with what was on the 1099R form. I then changed that number to the lower number by subtracting the amount I already was taxed by NJ in 1983. I then selected the 3 year rule because all of this excluded amount would be withdrawn in 3 years.
When I did this the NJ tax/refund number on the top of the screen went from showing a large number for taxes owed to a large refund. Well, I knew that wasn't right and I thought information must be missing since TurboTax never asked me to enter baseline information on the NJ 3 year rule I selected. I still continued and when I got to the Review section, sure enough, there were a few screens that came up asking me to enter the baseline information for the NJ 3 year rule. Once I did that, the correct tax calculation appeared on the NJ return with the amount already taxed excluded.
Hopefully this description will help others in NJ that had a 401K distribution with money in the account that was already taxed by NJ prior to 1984.