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toms1416
New Member

I live in Georgia with a W-2. I have a Michigan State tax free 1099-r. When I enter the 1099-R it adds over $2000 to my Georgia tax owed. How do i fix this?

 
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1 Reply
DavidD66
Employee Tax Expert

I live in Georgia with a W-2. I have a Michigan State tax free 1099-r. When I enter the 1099-R it adds over $2000 to my Georgia tax owed. How do i fix this?

Can you clarify some information.  Who is the 1099-R From (who paid what is reported on the 1099-R).  What is the distribution code in box 7 of your Form 1099-R?  You said it is a Michigan State tax free 1099-r.  Why do you say it is tax free?  

 

As a Georgia resident, all of your income is subject to Georgia Income tax, regardless of where it's from.  Since it was a retirement distribution, some or all of it could possibly qualify for the Georgia exemption on retirement income, which is based on the age of the recipient and subject to limitations.  If the distribution is taxable for federal tax purposes, then it would be included in you federal Adjusted Gross Income (AGI).  Georgia uses federal AGI as the starting point for determining Georgia taxable income.  Your 1099-R income might be excluded from Michigan State tax, but that doesn't mean it isn't taxable by Georgia.  

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