Arizona does not tax military retirement. However, TurboTax is calculating this income as taxable. Is there something missing?

[DawnC]

When you entered the 1099-R in the federal section, make sure you mark the box that it was military retirement.   And then when you go through the AZ state return, you will come to the screen below where the subtraction is confirmed.   The first pic is from the federal entry and the 2nd is in the state interview.  

[cobrastklc]

I do not see these pages you are showing.  As a test, since we used the photo option for first entry, I went through and entered another 1099-R and this question never came up.  ??????????

[cobrastklc]

I do not see this section you are referring to.  Did I miss something?  As  a test since we used the phone scan to enter, I generated another 1099-R and this question never came up.  ??????????????????

[DaveF1006]

I tested my program and it works just like DawnC described. it should apear in this order.

1. After entering the 1099R
2. Say no to the IRA question
3. No, you weren't a Public Safety Officer ( yes, if you were )
4. The very next screen should look like this.

Note: The three boxes in the bottom doesn't need to have anything in them.

[cobrastklc]

Beginning to think this is because I am using the Online option?  The next screen I get after the IRA option is a simple qualified or not.  Shouldn't be a difference I would assume.

[BillM223]

Is the IRA box (next to box 7) checked on your 1099-R? I doubt that this is a distribution from an IRA. 

If indeed, you are getting the qualified or not screen, as noted on the screen, military retirement is generally not qualified...and yes, if make a huge difference in the number of questions you'll see.

And Arizona probably thinks that only a 1099-R from a plan is excluded, not an IRA.