How do I flag NYS employee tax exempt retirement distributions as NYS tax exempt on my 1099R?
It is a double-entry. The first area to enter is in the Federal Taxes section of TurboTax. First, when entering in your 1099-R information, make sure that your state and state distribution amounts are included in the TurboTax 1099R screen. Then, you will be asked questions, for example, about whether you were a public safety officer (police or fire), and then the type of account (IRA), and what you did with the funds. Afterwards, you should see a screen that will allow you to select your state, or will identify that your state is NY. On that screen, make sure that NY is chosen. You will then be given a list of pension/retirement accounts exempt from NY tax, which you will see in the screenshot below. Choose the one that applies to you (a military pension, for example, would be a Federal Government pension. If unsure, comment the nature of your pension so we can assist, although Learn More links are available for most of the types of pensions mentioned).
On the state return, you will want to review the entries to make sure the pension has been excluded, which will be shown on the last section of the retirement income screens in the New York Return. The initial retirement screen is shown in the second screenshot below:
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