IRA Deduction - Multiple States?

Forum|Forum|7 years ago
June 4, 2019
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I have entered a $5500 traditional IRA deduction for my federal return.

However, in 2016 I was a partial resident of Hawaii and California, and worked as a Hawaii resident in Colorado for a few months before moving to California.

How do I allocate the $5500 IRA deduction among these states? Do they each get the full $5500 deduction, or is it proportionate between them according to the portion of money made in each location?

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Best answer by DS30

It depends.

You will allocate the deduction based on the state you were a resident of when the IRA contribution was made. Please note you will only allocate the deduction to resident states so no allocation to CO since you were an HI resident while working in CO (nonresident CO state filing for your CO sourced income).

For example, if you contributed $2,000 while a HI resident and $3,500 while a CA residence then allocate those amounts to each state. If you contributed the full amount while a resident of CA, then the full amount will be allowed to your CA part-year resident state income tax return. Just make sure that the total allocated to all states does not add up to more that your full IRA contribution of $5,500.