I do not owe any state tax,i was Bailey vested as of 08-12-1989

As long as you had 5 years of service credited before 12 Aug of 1989...then you would qualify for the "Bailey Settlement" .

The procedure is the same in TurboTax every year, so (perhaps) print this out for next year and file it.

____________________________________________________

Go back and edit the 1099-R form in the Federal section.

 After you enter your 1099-R form, and "Continue" thru the pages that follow it...until you find the selections for:

1) "Bailey settlement...."....................<<<<you are selecting this one

2) "Faulkenbury settlement...."

3) "Railroad Ret-SS.........."

4) "None of the above"

You need to select the "Bailey Settlement..."

Your NC Distribution amount is the same a box 2a of the 1099-R form (or the calculated federally-taxable amount of box 1, if 2a is empty or "unknown")....... that $$ will be removed in the NC section depending on what selection you made above.

(Picture Below)

.....Far fewer retired Military/Fed/NCStateMunicipalTeacher employees can exempt their Pension $$ if they retired this year.  BUT...IF you were into your NC-State or Federal/Military pension system, 5 years as of 12 Aug 1989, you can choose the "Bailey Settlement..." and all of that particular 1099-R will be exempted from NC taxation...otherwise you will likely choose "None of the above"

So that 5-years employment/Service  by 12 Aug 1989 is critical.

.......if you weren't employed or in-service the NC or Federal Gov't body early enough to meet that deadline...then your Pension distribution is not exempt from NC taxation

____________________________