State Pension Income

[jbshah40]

Turbo tax did not report part of my state pension income on state (non-resident) tax form, but included in total state tax paid.  Therefore, it is under reporting my non-resident state's total taxable income and over reporting resident state's taxable income.  How can I force turbo-tax to correct this when it is importing data from my federal tax return.  My entries for 1099 show the two states'  taxable income as well as taxes paid.  My 1099 reporting is correct. My federal tax return reporting is also correct.   

[Mike9241]

based on a Supreme Court decision only your resident state can tax pensions.   so if you worked in Wi and earned a pension there but later moved to Ca where you started receiving your pension, only Ca can tax it. 

Move to Il, it doesn't tax social security, IRA or pensions (annuities are taxed) - maybe that's the reason is so broke all the time or Fl no state income taxes

California tried to tax its pension payments made to taxpayers who earned the pension there but were no longer residents. the Supreme Court told Ca it can't do that.

[MayaD]

Your pension income is taxable only in your resident state. You do not need to report your pension income in any state other than your resident state.

You need to file the Nonresident return to get a refund if you have any taxes withheld to the non-resident state.

[jbshah40]

I agree.  I contacted the company issuing 1099 to re-issue corrected 1099 showing my income and tax withheld in my resident state only.  Once I receive it, the matter will be solved. But my problem does not just end here.  My problem is why Turbo tax shows partial tax in non-resident state but does not show pension income related to that partial tax withheld in non resident state.  I notified pension company to change my permanent address in Feb.2022.  They never went back to correct Jan.'s pension income and tax withheld to show it in correct state despite I had told them that we are no longer resident of that state as of 2020.  The whole thing is pension company's carelessness and not handling changes properly.  I would not be in this situation had they had fixed it properly to begin with.   As a result now I am stuck with this problem in Turbo tax.  I input for two states in turbo tax per 1099, but now turbo tax shows only tax portion of the non resident state and not the income when I calculate my taxes for that non resident state.    

[Cynthiad66]

Actually, the pension income is not considered to be earned in the Non-resident state.  That is why TurboTax is not adding it to the Non-resident state.  You do not have to file a non-resident tax return unless they withheld taxes for that state.

Your goal is only to retrieve state withholdings for the Non-resident state, if any was withheld.

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[jbshah40]

Thanks@cyntha66.  Your answer makes sense with respect to turbo tax not reporting my pension income in non resident state, but it shows the taxes withheld in that state.  Now I can use the tax withheld to offset against the non-resident state's tax liability due to other income in this non-resident state and move on to finish my resident state taxes.  That is one option.

My second option is to ask the 1099R issuing company to correct it. 

Anyway, I appreciate everyone who responded to my inquiry and make me feel part of the TT community.