How do I exempt my 100% of my Military Retirement 1099-R for the state of Nebraska. The law changed, but it does not appear to be correct in turbo tax

[rjs]

According to the TurboTax forms availability tool, the Nebraska forms are currently expected to be available on January 26. (That date could change.) Until then, any Nebraska forms that you see in TurboTax are incomplete and are not ready to be used, so you can't draw any conclusions from them. Wait and see whether it works when the forms are officially available.

When will my individual tax forms be available in TurboTax?

[Bill_Bright]

I don't understand where we are on this. It is 2/8 and the exemption field is blank. It does not appear the Nebraska Turbo Tax forms are updated.

Does the Nebraska form automatically import my military retirement pay from the DFAS (Defense Finance and Accounting Service) 1099-R for my retirement pay? 

[DMarkM1]

Yes, once you enter the form 1099-R in the federal interview it is included in your Federal Adjusted Gross Income which transfers to your NE return.  You can exclude 100% of that military retirement pay from NE tax.   

1. Go to your NE state return
2. "Update" the "Adjustments" section  
3. Click through to the "Adjustments Decreasing Federal Income" page 
4. Locate the box for Military Retirement Pay Exclusion  
5. Enter the amount of your military retirement pay from box 1 of your 1099R      

[Bill_Bright]

Thanks and that is what I did but "I" did that. You say it automatically transfers to the NE form, but it doesn't. Yes, my income did - but why not automatically do the exclusion too?

It seems to me, that should be an automated process via TT since I already entered the 1099-R information indicating it was from DFAS. I should not need to manually do that.

It would be good too if when you click on Military Retirement Pay Exclusion in the NE TT return and the On Demand Tax Guidance window pops up, if the information there said to include that value from Box 1 of the 1099-R. It just says, "Enter the amount of military pension included on line 5b, Federal Form 1040 or 1040-SR, page 1."

Why can't TT do that for us? 

[MarilynG1]

Since it's possible that there may be more than one 1099-R in a tax return reporting a State non-taxable pension (like a Nebraska State Pension, for instance), that's why TurboTax references Line 5b on Form 1040 (which would be a total non-taxable amount).  

In this case, you need to refer to your 1099-R for the amount of your Military Pension. 

Here's more info about the Military Retirement Benefits Exclusion in Nebraska. 

[Bill_Bright]

Well, this is [finally!] the first year Nebraska did this. Hopefully, next year, it will be a smoother, totally automated process. 

Thanks to Marilyn and DMarkM1 for your help. 

[SDK-]

It won’t be simpler.  We live in Louisiana & Turbo Tax lists the exemption on the state form, but puts in amount as “0”!

I listed the correct code, but it is still incorrect.  Every year I file a paper state return because of this.  It’s a pain!  Good luck.

[Bill_Bright]

@SDK- Please note you are replying to a question posted 2 years ago for 2022 taxes. 

This year (for Tax year 2023), it worked as expected for me in Nebraska. 🙂