On page 2 of Alabama Form 40, my total pension and annuities amount on line 5a is $147,591. This is combined income from the Retirement System of Alabama and the Federal Retirement System. According to Alabama law, both of these systems are considered exempt income from Alabama Income Taxation. If this is the case then why does line 5b on page 2 of Alabama Form 40 in Turbo Tax states that the taxable amount is $69,090. If both of those incomes are exempt, shouldn't the taxable amount be $0.00. Is this a flaw in the program or am I missing something here?
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