Pickup Contributions

[parrish21214]

Reference: State Taxes/Maryland

What is the Pickup Contribution Subtraction? I entered $34,335 pickup contribution from my MD State Retirement 1099-R. The subsequent screen shows $48,600 as the "Pickup Contribution Subtraction." How was that number derived?

[MaryK4]

You have already paid Maryland State taxes on the pick-up contributions listed on your 1099-R. To avoid paying taxes twice, you must subtract the pick-up amount from your federal adjusted gross income.  The subtraction is limited to the amount of pick-up contribution stated on the 1099-R or the taxable pension, whichever is less.  The remainder of the pick-up amount is carried over to next year's taxes.

Block 17 of the 1099-R form contains the amount of your tax deferred contributions made under the State Retirement Pick-up Program.