Question

What indicates Bailey Retirement deduction applies on my 1099R?

Forum|Forum|5 years ago
March 9, 2021
1 reply
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Something in Turbo Tax triggered this to pop up and I don't know what it is and don't know how to handle

TurboTax Self Employed Online

Employee

For any 1099-R received by a NC resident of retirement age.......if the retirement plan issuing the 1099-R was from a US Govt or Military retirement system, or an NC state Retirement system, then it's possible that it is not taxable by NC....but ONLY if you were in that retirement system 5 years before 12 Aug of 1989....That's the Bailey Settlement selection. Otherwise it's None of the above.

(the other two selections probably shouldn't show up at all. SS/RR forms are entered elsewhere, and I think eligibility for Falkenbury ended years ago, and again is just an NC state retirement system thing)

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*

M

mbagleync55Author

Well, I don't even get that option. I reside in SC and had rental income and capital gains in NC to pay taxes on. My 1099R's should only be taxed on federal and SC. There was no withholding for NC. The deduction is called Bailey for the 1099R's in NC. It should be adjusted out but not for Bailey. How should I proceed?

SteamTrain

Employee

@mbagleync55

If you will be doing an NC nonresident tax return.....ALL your Federal income will be dumped into the NC nonresident tax return "at first".....BUT...you will be able to remove most of that income from NC taxation during the NC nonresident interview. You will be able to make most of the NC allocation fields to be zero's, except for the rental and investment fields.

But get every scrap of Federal Income in first...and all Federal Deductions&Credits too....everything, and error checked...then do the NC Nonresident to do the income allocations....then SC resident last.

____________*Answers are correct to the best of my knowledge when posted, but should not be considered to be legal or official tax advice.*