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How do I remove Social Security Benefits from AZ-140, Line 31? Arizona taxes Social Security Benefits & TurboTax erroneously subtracts them.

 
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4 Replies

How do I remove Social Security Benefits from AZ-140, Line 31? Arizona taxes Social Security Benefits & TurboTax erroneously subtracts them.

Arizona does not tax Social Security benefits.

The Arizona instructions say

"Arizona does not tax the following:
• social security benefits received under Title II of the Social Security Act, or..." and

"If you included such social security or railroad retirement
benefits as income on your federal return, use line 31 to
subtract this income."

Please see page 13 in the 140 Instructions at https://azdor.gov/file/6960/download?token=Z2bCZLNp

sfq1
New Member

How do I remove Social Security Benefits from AZ-140, Line 31? Arizona taxes Social Security Benefits & TurboTax erroneously subtracts them.

Agreed, Arizona does not tax Social Security Title II Disability Benefits, however, regular Social Security Benefits are taxable.

TurboTax erroneously subtracts regular Social Security Benefits on AZ-140, Line 31.

How do I correct this error & reverse TurboTax's subtraction of regular Social Security Benefits on AZ-140, Line 31 so I can file my taxes?

How do I remove Social Security Benefits from AZ-140, Line 31? Arizona taxes Social Security Benefits & TurboTax erroneously subtracts them.

Please look at the Title II language at <a rel="nofollow" target="_blank" href="https://www.ssa.gov/OP_Home/ssact/title02/0200.htm">https://www.ssa.gov/OP_Home/ssact/title02/0200.h...> . It refers to both the Federal old-age and survivors insurance trust fund and federal disability insurance trust fund. The Federal Old-Age and Survivors fund is the fund that pays regular Social Security benefits (see Section 202 and following), while the Federal Disability fund pays for disability (see Section 220 and following).

It seems to me that the Arizona reference to Title II is actually a reference to both disability AND regular Social Security.  

How do I remove Social Security Benefits from AZ-140, Line 31? Arizona taxes Social Security Benefits &amp; TurboTax erroneously subtracts them.

To be clear, TurboTax is not the only institution that believes that Arizona does not tax Social Security benefits. Please see <a rel="nofollow" target="_blank" href="https://www.fool.com/retirement/2018/03/06/the-37-states-that-dont-tax-social-security-benefi.aspx">...> (the "fool" is the Motley Fool, a long-time financial planning site), <a rel="nofollow" target="_blank" href="https://www.kiplinger.com/slideshow/retirement/T051-S001-states-that-tax-social-security-benefits/in...> , <a rel="nofollow" target="_blank" href="http://money.com/money/4502741/social-security-state-taxes/">http://money.com/money/4502741/social-s...> , and <a rel="nofollow" target="_blank" href="https://taxfoundation.org/monday-map-state-income-taxes-social-security-benefits">https://taxfoundat...>

I think it's pretty obvious that Title II refers to both disability and regular benefits.
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