The State of New York does not tax pension distributions from a New York state or a local government pension plan or federal government pension plan. For more information on the kinds of plans this includes, see the Form IT-201 instructions or Publication 36 linked below.
If included in federal AGI, pension distributions other than those from a New York state or local government plan or federal government pension plan are taxed, however a taxpayer aged 59-1/2 qualifies for an exclusion of up to $20,000. In the year the taxpayer turns age 59-1/2 the exclusion is applicable only to the portion of the pension income they received after turning age 59-1/2. For married taxpayers filing jointly, the $20,000 exclusion is per spouse.
In TaxSlayer ProWeb, if the federal return includes taxable pension or retirement income, when starting or opening the New York resident tax return you'll be asked if they qualify for the pension exclusion. If they qualify to exclude some portion from taxation, click YES to go to the page to enter the excludible amounts:
- Enter the Taxable Pensions received from New York State, Local, and Federal governments - Enter the amount of governmental pension received that is exempt from taxation.
- Enter other taxable pensions (not included above) received from the time you turned 59 1/2 to the end of the tax year - Enter the amount of non-governmental pension received that is excludible, up to $20,000.
Otherwise, to navigate to this menu from the New York Return menu select:
- Subtractions from Income
- Certain Pension Income Is Excluded From New York Taxable Income
Additional Information:
New York DTF: Form IT-201 Instructions
New York DTF: Publication 36, General Information for Senior Citizens and Retired Persons