Tax on qualified dividends on state return?
I am a non-resident of MA. I am using turbotax for my tax preparation. My "ordinary dividends" & "interest" was carried from 1040 to my MA 1-NR/PY automatically. However my qualified dividends did not get carried over. Should qualified dividends be reported in MA return for a non-resident? Though I don't pay any tax on any dividends & interest, I still have to report it for exemption ration calculation. I am not sure if I have to include qualified dividends in that calculation because turbotax did not do this for me automatically and hence I am not sure if it is a software error or intentional. I called them up but they didn't have a clue what I was asking.
Public Comments
- States do not distinguish between ordinary and qualified dividends. All dividends are taxed evenly at the state level. On your federal return, there is a line showing Dividends and another line showing Qualified Dividends. Qualified Dividends are a subset of the ordinary dividends. Example: Ord Divs = $400; Qual Divs = $150. Your "non-qualified" dividends are $250 and the total of ALL dividends is $400, NOT $550. - A Damn Fine Tax Advisor
