How Enter NJ State Pension General Rule

Forum|Forum|5 months ago
March 15, 2026
5 replies
138 views

Hello. I just started receiving my teacher's pension in 2025 for five months. Being that my monthly pension payment will not equal my contributions in 36 months I have to use the General Rule. In Turbotax they ask "Contributions made to the plan (basis)" which I understand is my total contributions. Then they ask "Expected return on contract". What is this value supposed to be? If it is an expected return how do I calculate it? Thank you in advance for your assistance.

LaShaunA3

Level 6

Under the IRS General Rule, your “expected return on contract” is the total amount you expect to receive over your lifetime from the pension. It’s calculated by multiplying your annual pension amount × your IRS life expectancy factor.

For more information, see,

Publication 939

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StevenbirnAuthor

Level 4

Thank you for your response. Since it is a qualified plan and will not cover my contributions in 36 months I have to use the General Rule - Simplified Method. The IRS Publication 575 gives the worksheet and it is easy to calculate. The only problem is that Turbotax does not give me the option for New Jersey to use the simplified method, in my case dividing my contributions by 260. It only allows me to use the life expectancy factor. The only way I can think of doing it is to back into what the future value is by using the result. Is there a way Turbotax will do it correctly for the Simplified Method?

AmyC

Level 15

To trigger the Simplified Method option for NJ, follow these steps:

Go back to the Federal section → Wages & Income.
Edit your 1099-R.
Ensure Box 9b (Total Employee Contributions) contains your total pension basis (your contributions).
When asked "What kind of plan is this?" select Qualified Plan.
403b I assume which in an annuity
RMD is the full amount
TurboTax might ask if this is a "Qualified Plan" and if you want to use the Simplified Method. Select Yes When I created your situation, it did not ask, it used the simplified due to all the answers before.
Once the federal side recognizes it as a Simplified Method calculation, it usually carries that "logic" over to the NJ state return. I checked in NJ and it did carry over correctly - using blank for the federal simplified method instead of the 3 year, general or military options.