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Retirement tax questions
It depends. First, @gguerin602, I wanted to point out that legislation in 2018 lowered the automatic pension amount from 41,110 to 31,110 and therefore I have edited my content in the above answer to reflect that information.
Your situation is a bit different, but the question on the KY Schedule P interview basically asks if the retirement is from before 1998 or since Jan. 1, 1998 or after that point. And that's where all of the service credits come into play to determine how much of the pension is potentially taxable. (It's a convoluted calculation).
So, the question is if you received two separate retirement form documents. If you did, you will treat both as if they were "after" December 31, 1997. But for the (military) one that had all of the service credits from before 1998, you will apportion by percentage: 100% nontaxable. The other Form 1099-R will be pro-rated by service percentages (if applicable).
The caveat is if there is a specific percentage given to you on the 1099-R (sometimes this is the case). You must use that percentage for that 1099-R if that's the case.
Comment back if you see something different.
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