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New Member
posted Mar 4, 2023 9:32:20 AM

What is the taxable pension and disability exclusion for spouse?

Why is there
 a taxable pension and disability exclusion for spouse?

0 5 594
5 Replies
Expert Alumni
Mar 4, 2023 10:50:38 AM

Can you clarify if this is for a state tax return?  @susansjacktar1 

New Member
Mar 5, 2023 8:33:47 AM

Yes, it is for the state of Maryland.

Expert Alumni
Mar 6, 2023 6:23:05 AM

If you are 65 or older or totally disabled (or your spouse is totally disabled), you may qualify for Maryland's maximum pension exclusion of $34,300 under the conditions described in Instruction 13 of the Maryland resident tax booklet

If you're eligible, you may be able to subtract some of your taxable pension and retirement annuity income from your federal adjusted gross income.

 

This subtraction applies only if:

  1. You were 65 or older or totally disabled, or your spouse was totally disabled, on the last day of the tax year; and
  2. You included on your federal return income received as a pension, annuity or endowment from an "employee retirement system." These include qualified defined benefit and defined contribution pension plans, 401(a) plans, 401(k) plans, 403(b) plans, and 457(b) plans.
  3. A traditional IRA, a Roth IRA, a simplified employee plan (SEP), a Keogh Plan or an ineligible deferred compensation plan does not qualify.

Maryland Pension Exclusion

New Member
Mar 23, 2023 12:55:30 PM

It seems TurboTax does not give this Maryland exclusion if you are disabled but less than 65.

Something I am missing or need to bypass?

Level 8
Mar 23, 2023 3:56:43 PM

Here's what you are going to do

when you enter your pension in the federal input. Be sure to code it 3 disabled and not an ira like this

then when you go into your state MD return, when you get to this input, make sure you hit yes

 

which will take you into the next screen like this

I hope this works for you. Please come back and share your success!