Colorado taxable income is based on the Federal Taxable Income. The main deduction is for IRA/Social Security/Pension incom of up to $20,000/each for ages 55-64 and $24,000/each for ages 65+. I have not specified any federal income that is not subject to state taxes (eg. Treasuries)
In the Expenses / Taxes table (see attached), the CO taxable income is coming in $53,251 less than the federal taxable income. This isn't right - unless I'm missing something. Both of us are in the 60-64 age group in 2024, so it should be $40,000 less than the Federal Taxable income.
Please take a look.
Thank you.
Any timeline for a fix?
Here's the relevant document from Colorado.gov
https://tax.colorado.gov/sites/tax/files/documents/ITT_Social_Security_Pensions_and_Annuities_Feb_2024.pdf
@cedyathome What about the standard deduction? It appears to me that this is $27,700 for a married couple.
Stuart
Hello Stuart,
The colorado tax is based on the federal Taxable income - line 15 of 1040, so the federal standard deduction is already factored in. See the jpeg I attached. The difference between the Federal Taxable income in 2024 ($94,050) and the State Taxable Income ($40,799) is $53, 251. I can't figure out where this number is coming from. At most, that deduction should be $48,000 (as you wrote in your other response, you're taking a flat $24,000 per person IRA deduction).
I am opening my file for admin access. The numbers are now different since I've been working on the plan. Interestingly, the difference between federal taxable & state Taxable income is still $53,251 even though the withdrawal from IRA (Roth conversion) for 2024 is $43,250.
I appreciate your looking into this issue & look forward to your response.
