You need to indicate in Turbo Tax that you have a non-taxable NJ pension that is not taxable in New Jersey. Make sure when you reported the distribution in your federal Turbo Tax interview, you indicate this is a military pension. After the 1099R entry, you should reach a screen asking where is your distribution from? Here you will indicate this is Military pension or survivor's benefits. This is key information that gets transferred to th state return as you start to prepare it. When you get to the screen that asks what kind of plan it is, you will select it is a Non-qualified plan, as with the case with military pensions. In addition, when you prepare your state return. indicate you are a Military Veteran in the section entitled Other situations that may apply to you. The next screen will be a screen entitled Exemption for Military Veterans. Be sure you check that box.

Question

Why is turbo tax reducing my NJ expected refund for a 1099R military pension. Military pensions are not taxable in NJ.

Forum|Forum|4 years ago
January 11, 2022
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TurboTax Deluxe Online

DaveF1006

You need to indicate in Turbo Tax that you have a non-taxable NJ pension that is not taxable in New Jersey. Make sure when you reported the distribution in your federal Turbo Tax interview, you indicate this is a military pension.

After the 1099R entry, you should reach a screen asking where is your distribution from? Here you will indicate this is Military pension or survivor's benefits. This is key information that gets transferred to th state return as you start to prepare it.
When you get to the screen that asks what kind of plan it is, you will select it is a Non-qualified plan, as with the case with military pensions.
In addition, when you prepare your state return. indicate you are a Military Veteran in the section entitled Other situations that may apply to you.
The next screen will be a screen entitled Exemption for Military Veterans. Be sure you check that box.