Inherited IRA distribution taxable in Massachusetts?

[dwhewlings]

Q1: My spouse and I live in MA and each of us received a distribution from an Inherited IRA in 2022, mine from an account originally established in VA and hers in PA. Whether the basis in either account was originally subject to state income tax is unknown. Are these distributions taxable in MA?

Q2: In TTax H&B 2022 for Mac, the MA Schedule X Taxable IRA/Keogh Plan Distributions Smart Worksheet has a line B titled "Non-MA portion of IRA/Keogh distributions." That line does not appear in the Form 1 Instructions at MA.gov. What goes on this line?

Thanks very much for your help.

[ErnieS0 · Accepted solution]

Yes. Your inherited IRAs are taxable by Massachusetts because you are MA residents. Pensions and IRAs are taxed according to the recipient’s resident state so no tax is due, nor is filing required for Pennsylvania or Virginia.

The Non-MA portion of IRA/Keogh distributions is $0 because it’s entirely taxable to MA.

[dwhewlings]

Thanks ErnieS0. What is an example of a "non-MA portion of IRA/Keogh distributions?" In other words, what is line B of the worksheet for?

[MarilynG1 · Accepted solution]

'Non-MA portion'  would apply if a person lived part of the year in Massachusetts, and part of the year in another state.  They would need to allocate their income according to the % of time they lived in each state.  

Here's more info on Allocating Income. 

@dwhewlings