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My state retirement is supposed to be exempt from State taxes yet as I enter the 1099-R info my state tax owed increased... why is this?
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Your tax return is a work in progress until you have gone through everything, both Federal and state.
As you enter the information on your Federal return, you may see some follow-up questions that will be taken into account once you go to your state return to complete it. Also, depending on your particular state, there may be questions within that return that must be answered before the retirement income is removed from your state taxable income.
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