1099-R; In Arkansas I can deduct $6000 from my taxable income? Do I subtract $6000 from the amount in box 1 or do I enter the full amount shown in box 1?

[ohm7771]

Example: if box 1 of 1099-R says $20,000 do I enter $20,000 or $14,000?

[SusanH · Accepted solution]

On the initial 1099-R entry screen you should enter everything exactly as it appears on your 1099-R.

Two or Three screens after the initial 1099-R entry screen you’ll see a page titled “Where Is This Distribution From?” This [see screenshot] is where you will enter the information that will determine whether or not your pension income is excludable on your Arkansas state return. Click the radio button to the left of the correct source for your pension. Continue through your return.

When you are going through the screens for the Arkansas return, you will come to a screen titled “Arkansas Pension Deduction” [see screenshot]. If your pension qualifies for the exclusion (based on your entry in the federal income section) you will see the $6,000 Arkansas Pension Deduction.

Arkansas Special Handling of Pension Distributions

TurboTax Arkansas uses the following pension code:

• E - Employer-sponsored pension plan/qualified IRA
• M - Military Retirement

You can deduct up to $6,000 each from your Arkansas taxable income for qualified pension and IRA distributions. To qualify, the distribution must be one of the following: 

• From a public or private employer-sponsored retirement plan, including disability retirement benefits and early distributions
• An IRA distribution after reaching the age of 59 1/2 or a premature distribution because of the participant's death or disability