Article: 50133

General Information

In general, New York State does not tax certain types of pension income, including:

• Payments from the New York State or local government
• Payments from the federal government, including Social Security benefits
• Payments from public authorities (such as the Port Authority of NY/NJ)
• Income from pension plans protected under Section 114 of Title 4 of the U.S. Code while you are a nonresident of New York

If your pension is taxable in New York and you are age 59½ or older (or turn 59½ during the tax year), you may qualify for a New York State pension and annuity exclusion of up to $20,000. This exclusion applies only to income already included in your federal adjusted gross income.

For more details, refer to the New York State website.

Special Circumstances List

1. Go to Federal Taxes > Income > Retirement to add a new Form 1099-R or go to Federal Taxes > Review > I’d like to see the forms I’ve filled out or search for a form and open a Form 1099-R that you have previously added.
2. Make sure that you have entered the appropriate amount for Box 16 – State Distribution (the exclusion is calculated from this amount).
3. Using the drop-down below Tell Me More, choose the applicable option:
   • G – US Government
   • M – Military
   • S – State Government
   • Z – City Government
4. Click Save.

Manual Exclusion

In some circumstances, you may need to manually exclude the pension amount. To do this,

1. Go to Federal Taxes > Review > I’d like to see the forms I’ve filled out or search for a form and open the Form 1099-R that you have previously added.
2. Click Advanced Options.
3. Under Tell us the portion of this 1099-R to exclude on your state return, enter the percentage or amount that should be excluded.
4. Click Save.

IRA vs. Non-IRA Pensions

While the process of claiming the pension exclusion is similar for all pension types, it’s essential to identify whether your pension is from an IRA or non-IRA because they are reported differently on New York Form IT-201:

IRA or SEP

• Check the box This distribution is from an IRA or a Simplified Employee Pension plan (SEP). below box 7 when entering Form 1099-R.
• The taxable portion will flow to Line 9 of Form IT-201.

Non-IRA Pension

• Do not check the box This distribution is from an IRA or a Simplified Employee Pension plan (SEP). below box 7
• The taxable portion will flow to Line 10 of Form IT-201.