MA Tax-exempt pension

[gcorbin_51]

pensions and annuities smart worksheet

[gcorbin_51]

Trying to submit MA taxes.

I receive the item to address:

"Form 1: Tax-Exempt Pension should not be entered directly on Form 1 for State Electronic Filing. You should enter the information on the Federal Return, Form 1099-R and/or use the Pensions and Annuities Smart Worksheet to make any tax-exempt adjustments."

Not sure what to do.

Suggestions?

Thanks

[RaifH]

When you input your pension into the federal area of the return, did you indicate that it was from a tax-exempt source for the state of Massachusetts? To do this:

1. Verify your 1099-R entry under Federal > Wages & Income > Retirement Plans and Social Security > IRA, 401 (k), Pension Plan Withdrawals (1099-R)
2. If this is a tax-exempt pension in the state of Massachusetts, it should fall under one of the categories of Qualified government retirement distributions listed on the Where is your distribution from? screen.
3. Continue through the remaining 1099-R screens.

If you do it this way, the system should automatically exempt it on the state return and should clear the error you are encountering. If you entered everything correctly the first time, you may want to try to delete it and re-enter the information. 

[gcorbin_51]

I have two 1099-Rs this year:

One Is for an IRA distribution that is taxable in MA and that is showing up on my MA tax return (Distribution Code 7.)

The second is for a Rollover from a 401(k) to an IRA (not Roth) that is not a taxable event (Distribution Code G.)

Could this be the one causing me an issue?

Thank you

[RobertB4444]

That would be the one that is causing you an issue.  A rollover isn't taxable anywhere including Massachusetts.

[gcorbin_51]

Thank you for confirming.

Any suggestions as to for to get though this issue so I can file my MA taxes electronically?

Thank you.

[AmyC]

Yes, it takes action in the federal and the state portions of the program. If you have the federal entered correctly as stated above by @RaifH, then move to the state portion.

On the State return: 

1. At the Changes to Federal Income page, scroll down to Received retirement income, click Start (or Update)
2. At the Retirement Distributions Summary page, click on Edit State
3. If no additional information is required, click on Continue
4. Click on Done

Here is a link to the MA state website, which discusses the taxability of MA pensions

[gcorbin_51]

My apologies, but I am still stuck.

Note that I am using the online version of TurboTax

Here is what I am asked during the 1099-R entry for the Rollover:

In the MA section, I get asked the following:

And still get the following error:

There is also reference to a Pensions and Annuities Smart Worksheet, but I don't see how to access it.

Thank you for the support and patience working through this.

[GeorgeM777]

@gcorbin_51  In connection with completing the federal section as it relates to your 401(k) rollover to a traditional IRA, you should have seen pages similar to the ones below. (the example in these pages reflect an $8,000 rollover to a traditional IRA).  Because it does not appear that you saw pages of this type, this could be the cause of the issue you are confronting.  To resolve the issue, go back to the federal section and check your initial entries.   

[gcorbin_51]

@GeorgeM777 

Still not seeing these screens.

This is what I have entered on the "Enter your 1099-7 Details Screen":

How does this match what was entered in your example?

Again, thank you for all the support

[GeorgeM777]

To follow-up on our initial response, can you confirm for us whether the amount reflected on your 1099-R (that is the amount that is being rolled over into a traditional IRA) is showing as a non-taxable distribution on your federal return, Form 1040.  Our test return includes a 1099-R reflecting a gross distribution amount, a checkmark in the total distribution box, and a distribution code of G.   Line 5b on our test Form 1040 includes the term "Rollover" and a taxable amount of 0.  We understand that there may be an issue to resolve regarding your MA return, but for now we wanted to confirm what the 1099-R entries reflect on your Form 1040.  

Because you are using TurboTax online, to view your Form 1040, follow these steps.

1. Open or continue your return.
2. Select Tax Tools in the left menu (if you don't see this, select the menu icon in the upper-left corner).
3. With the Tax Tools menu open;
4. Select Tools.
5. Next, select View Tax Summary in the pop-up.
6. Then Preview my 1040 in the left menu.
7. To get back to the step-by-step instructions, just click Back in the left margin.

[gcorbin_51]

@GeorgeM777 

Makes sense.

Below is a snapshot on Form 1040.

I think that it looks correct.

I have included the other sources of income just so you can see the full picture.

Note that I took distributions from the IRA (line 4b) that I am rolling the 401k into (line 5a.)

Thank you for your support.

Greatly appreciated.

[gcorbin_51]

Just re-upping this request.

Any advice on next steps would be greatly appreciated.

Thanks

[Vanessa A]

Clarification...What exactly are you still stuck on?

[Vanessa A]

Clarification...What exactly are you still stuck on?