I worked as a state employee in Alabama. We are exempt from paying state taxes. Where do I indicate this on my state form?

[gwhatley]

Where do I indicate exemption from state taxes on an Alabama form?

[Cynthiad66]

Alabama considers income from Defined Benefit Retirement Plans to be excludable from tax, but you have to manually indicate that the plan qualifies to be excluded.

Here is a list of Alabama income that is exempt from state taxes.  If you are retired then that portion of your income could be exempt.

Follow steps below:

1. Go back into your state return.
2. Edit
3. Then scroll through pages until you see the page in Exhibit 1 Below
4. Click on Edit

Exhibit 1

The Special Handling screen will appear then just follow the prompts.

Exhibit 2