Income made in Texas cannot be deducted from Montana Income

[lbraun1987]

I am military from Montana stationed in Texas. I received 2 1099-Rs that have Texas "taxes" taken out in block 15 and need to do an amendment. When I input the amounts into the federal income section, it is automatically included in the Montana income section and I cannot figure out how to deduct it.

[DavidD66]

Box 15 of Form 1099-R only indicates which state the state tax withholding applies to, if there is any state tax withholding.  Since Texas doesn't have a state income tax there should not have been any state tax withheld.  State tax withholding is reported in box 14.  As for the the distributions being included in your Montana income, since you are a resident of Montana all of your income is taxable by Montana, regarded of where it comes from.  Moreover, retirement income is not associated with a state the way earned income is.  Your 1099-R income being included in your Montana income is correct.