Retirement tax questions

To get this exclusion, you would need to answer the TurboTax questions in a specific manner that starts out in the federal interview. The first thing that needs to be mentioned is that your military service must have  ended on or before October 1, 1991. If it did, here is how to answer your questions in TurboTax.  

• Federal
• Wages & Income
• Retirement Plans and Social Security
• IRA, 401(k), Pension Withdrawals (1099‑R) Edit the 1099‑R for your military retirement

After you entered the information from DFAS, there will be a question asking where the distribution is from.  

1. Here you will indicate Federal Retirement Benefits.
2. Next you will indicate this is a non-qualified retirement plan
3. Finish out this section.

Now when you start preparing your Oregon state return, it will recognize you have a federal pension. Doesn't need to be specifically labeled as a military pension. 

1. As you progress through your Oregon State interview, there will be a screen that says IRA and Pension Distributions. Here you will say you received federal pension income for federal service before October 1, 1991. 
2. When you get to your Oregon Pension Summary, select edit.
3. Then it will ask you for date you began work, and when you ended. these are the dates of your military service.
4. Once this information is entered, you should see the exclusion in a follow-up screen labeled IRA and Pension Distribution Adjustments.