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Level 2
posted Mar 29, 2020 10:52:25 AM

Deduction Allocations: Earned Income for HSA and Archer MSA Deductions

We lived and worked in multiple states in 2019. While entering all our info for the first state, on a page called "Deduction Allocations," it asks how much of our federal income that fits under "Earned Income for HSA and Archer MSA Deductions" should be allocated to the first state. I don't know how much to enter. The federal amount that it automatically populated is less than our total federal income but not a clear combination of some types of income but not others (e.g., wages + business income but excluding something else). I assume I need to enter the amount from the federal amount that was earned in the first state, but since I don't know what income it is including to calculate the federal amount, I don't know what to allocate to the state. (I also don't know what "Earned Income for HSA and Archer MSA Deductions" means.)

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1 Best answer
Expert Alumni
Mar 29, 2020 4:44:08 PM

Earned income is income from wages or self-employment, as opposed to unearned income, which would be form such things as interest and dividends, pension income and investment income.

 

You need to enter the earned income that you received while you where living in the state you are working on.

 

 

1 Replies
Expert Alumni
Mar 29, 2020 4:44:08 PM

Earned income is income from wages or self-employment, as opposed to unearned income, which would be form such things as interest and dividends, pension income and investment income.

 

You need to enter the earned income that you received while you where living in the state you are working on.