For the Georgia Retirement Income Exclusion, can we include the GA income tax refunds received on the Other Income Line of Schedule 1?

[BMcCalpin]

Yes, for purposes of the Georgia Retirement Income Exclusion, a Georgia state income tax refund would be included as part of the exclusion, so long as the refund were taxable in the federal return.

The reason is that a close reading of the Georgia forms and schedules shows that nearly all income received at age 65 and older (or 62-64 and disabled) is included in the meaning of "retirement income" for purposes of the exclusion, except for:

• earned income in excess of $4,000
• income received directly or indirectly from lotteries, gambling, illegal sources or similar income

(see Income Tax 500 and 500EZ Forms and Instructions on page 19) 

The list shown on the Georgia Department of Revenue website for retirement income is in a sense incomplete, in that it does not include "Other Income" which is on the retirement income exclusion worksheet. This Other Income includes virtually any other income received (with the 2 exceptions above).

[Edited 1.24.2017 | 09:36 AM CST]

[mcdk236]

When inputting the data within TurboTax, it is including the 2016 refund as part of the retirement income exclusion. Why would this be the case?

[BMcCalpin]

Let me take a look...

[BMcCalpin]

After much research, I found a small discrepancy between the Georgia website I had earlier referred to and the implied detail in the forms and instructions. The Georgia webpage for the Retirement Income Exclusion (second link above) leaves off an important category of income: "Other Income". In fact, as noted in the edited answer above, nearly ALL income received at retirement age is considered to be eligible for the retirement income exclusion, with the two exceptions listed above.