topic Is there a bug in the Delaware pension exclusion for persons over 60? in Retirement tax questions

Is there a bug in the Delaware pension exclusion for persons over 60?

rquizon — Sat, 01 Jun 2019 19:52:26 GMT

Delaware pension plan exclusion for persons over 60 should allow $12,500 to be excluded from state taxes. I sold $12,500 of 401K last year after I turned 60 but it is showing as income in the Delaware state tax Form 200-01 Income Allocation Worksheet.

It appears you are filing your Delaware tax return with t...

Karca — Sat, 01 Jun 2019 19:52:28 GMT

It appears you are filing your Delaware tax return with the filing status, "married filing combined separate."

In this situation, the pension income would first go to the allocation worksheet, so it can be allocated between taxpayer and spouse, those total numbers would flow to the form 200-01, line 29. The pension income will then be subtracted out of your Delaware income on form 200-01, line 35, after the allocation.

As you note: "If you were at least age 60 on December 31,...

BMcCalpin — Sat, 01 Jun 2019 19:52:29 GMT

As you note: "If you were at least age 60 on December 31, 2018, you can exclude the lesser of $12,500 or the total of the following:
- The amount of your pension (retirement)
- Your Eligible retirement income"

When you went through the Delaware state interview in TurboTax, what did you see when you came to the screen with the heading of "Pension and Retirement Exclusion"? Was $12,500 already there? Did you make another entry?

Also, were the pension distributions on your 1099-R all taxable? The exclusion only applies to taxable pension distributions?

We cannot see your4 return, but please look at the instructions for line 35 of the Delaware Instructions on page 10 at https://revenuefiles.delaware.gov/docs/TY11_booklet_res.pdf, to see if you can see any reason why the deductions might not have been fully used.