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March 29, 2025
Question

Alabama has a rule about not taxing the first 50k of severance pay. How do I use that info to reduce my tax burden via TurboTax?

  • March 29, 2025
  • 1 reply
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I have a WARN letter from 2023 and November 30th 2023 was my last day. The plant was shut down I received severance for 32 weeks.

1 reply

Employee
March 31, 2025

Generally speaking, special state options are addressed in the state interview.  You need to carefully review the pages that list state-specific additions and subtractions from income.  (Also, it sounds like you needed to make the adjustment first on your 2023 tax return, so you can calculate how much is left over to exclude in 2024.  You may need to file an amended state return for 2023.). If you can't find the item in the state module, you can call Turbotax customer support and ask to speak to a state specialist.