Michigan Form 4884 - Government pension (Type G) not being subtracted from MI income even though it qualifies.

[grpaul349]

Turbotax doesn't seem to have the updated 2023 Michigan 4884 Form. Public Safety pension are not subject to income tax in 2023 but Turbotax is continuing to tax them.

Any status on an update for this? (6a)

https://www.michigan.gov/taxes/-/media/Project/Websites/taxes/Forms/2023/2023-IIT-Forms/4884.pdf

[AmyC]

Yes. Please check forms availability here. Select online, Windows, or Macintosh from the drop down menu. Whenever the federal and states change a form, we have to as well. This happens throughout tax season.

[grpaul349]

Still not functional. Form 4884, Part 1 Question 6a is a pension deduction for:

Check here if you received qualified retirement benefits earned from service by a fire, police, or county corrections retiree (see instructions to determine if you qualify).

Turbotax State of Michigan does not have this option. Not having this option taxes your pension when legally it is not taxed. This is a major flaw that can cost someone thousands of dollars.

[SteamTrain]

@grpaul349 

Did you make the selection in the Federal section...where you entered your 1099-R form??

Edit that 1099-R in the Federal section, and, on a page AFTER the main form, there should be a selection page something like shown below  (picture form a prior year....might have changed some by now).

ALSO: the state distribution amount should be the value of box 2a, or the Federally-taxable amount of box 1 if 2a is empty.........even if the $$ value ends up being exempt.  IF you put a zero in the state distribution amount, then zero is subtracted form MI income (if eligible to be subtracted)

___________________________________

[grpaul349]

It's actually G - Government Pension.  This is the Form 4884. There is a special State Income Tax Exemption, 6a, as below. Turbotax doesn' t have it.

[LindaS5247]

When you initially entered the Form 1099-R in the Income Section for your federal return, after you enter the 1099-R, you need to select the right category as to where the 1099-R was issued from, to get it to flow to your MI return properly and be tax-exempt.  This will be one of the subsequent questions that will come up right after you enter your Form 1099-R.

When you select this (see below, select qualified government or public pension), it will flow properly to your MI state return as nontaxable

[WILLNDTW]

I posted on separate thread when I was having the same issue, and getting no solid answers from Turbo Tax.  Last week, the program was not exempting my husband’s pension income from Michigan tax form (he is retired police officer).   And the program kept reverting back to answer “no” when asking if pension was from public safety officer.  Form 4884 was not checking the correct box (6a).  I finally got it to work with a suggestion from a colleague who faked the program with an older birth year, and it checked the box.  Then I went back and corrected the birth year (and it saved the correct way).  However, now it is showing my pension income as exempt when it shouldn’t be.  The program clearly shows that I am not a public safety officer (box not checked), but both of our pensions are showing exempt.  Turbo tax doesn’t seem to understand my problem.  I almost filed in error twice:  Once without his pension being exempt, and then recently with both our pensions exempt when only his should be.  Turbo Tax doesn’t seem to care at all.  I’ve spent hours on the phone and no one gets it.  Only to “wait until Feb 13” when Michigan can start processing the form.  I have no faith at this point.

[SteamTrain]

Don't know if this was the issue, BUT.

...if you filed Jointly the prior year, and then did so again this year, but switched the positions of which spouse was listed first, then screwups like that can happen because the prior year data transfer had you each listed differently.

...or..if you filed MFS, or perhaps recently married and Single for 2022.....then changed to MFJ this year, and put the other spouse in the first position this year....that can confuse the software.

or maybe it has nothing to do with that.....the only way to truly get it checked out would be to have called customer support, and let them get a Diagnostic file from you to have their software folks check out the what and why.....othewise no way for anyone here to know what's going on.

[WILLNDTW]

Thanks for the response.   Nothing changed from last year to this year.  Still filing jointly, and names are in the same positions as last year.   I was on phone with customer service at least 3 times.  Shared screen, diagnostic run, etc.  First one named Adrienne admitted some type of issue, and reported it.  Next day, response was that  she "hoped it would be fixed with Michigan update the following day", and issue was closed.  Nothing was fixed.  Second one had no idea what was going on.  Third one was just as clueless and  told me the reason was probably because the Michigan form 4884 wasn't ready yet.  Even though Turbotax shows it up to date and you can file all the way through the system with no issue, no flag, nothing.  She didn't seem to think that was a problem?  I gave up at that point.  I have no faith in turbotax, that this program is going to file my return correctly, and feel sorry for all of my colleagues that have already filed incorrectly (either losing money from being taxed at state level since the program gives no indication of an issue, or in my situation where it is not correct).  I am waiting until Feb-13  when the form is supposedly ready to be processed by state of Michigan (doesn't hold up the filing of the return incorrectly, regardless).  But again, everyone I've spoken to at TT doesn't think this is a problem.   I will then file my return, and if it gets rejected or I have problems later, I'm holding TT responsible.  

[SteamTrain]

Yeah.....an error like that won't get fixed in one day.  It would take a couple weeks to go thru the correction process...be tested, and then integrated into the software updates...that update usually only happens once a week on Wed-Thurs overnight.

I think your original Customer Service contact was just hoping it was in the next MI update.

[WILLNDTW]

I definitely understand that.  Problem is, the program lets you file this way.  I've had colleagues that have done so.  And I'm not so sure TT understands the problem.  Well, maybe they do now, but customer service was not good at all at addressing this issue.  Just saying. Thanks again for the reply.