It sounds as though you followed the instructions for reporting the earnings on the excess contribution to the IRA by creating a 1099-R in TurboTax - and you entered in Box 1 total distribution plus earnings and are finding that MA is taxing the removed contributions as well.
To make a correction to ensure your removed contributions are not taxed by MA, follow these steps:
- Go to the State Tax section and Click on Edit for your MA return
- Go to the Adjustments section
- Click through on the screens by answering the questions until you get to a screen "Taxable IRA/Keogh Distributions - [name]"
- In the field "Other Contributions Previously Taxed by Massachusetts" enter only the amount of the contribution that was removed (do not include the earnings). Click Continue.
- Click through the remaining screens to get back to the page "You've finished your Massachusetts return"
This will correct the "double-taxation" on the IRA contribution to MA.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
