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Pension Exempt from State Tax

Submitted by galechip@gmail.com on 21 February 2009 - 2:47pm

As a NY state employee my government pension is not subject to state tax. How do I reflect this?

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Submitted by Dick Munroe on 23 February 2009 - 9:32am.
1

You will have to enter a special receipt for the amount of tax you've paid on your pension. Make sure that the additional income is marked as untaxed.

Best,

Dick Munroe

Submitted by galechip@gmail.com on 2 August 2009 - 6:47am.
2

Why not assume a lower state tax rate in the year my pension kicks in? I was going to assume the rate fell by the ratio of

(Total Income - Pension)/Total Income

This method seems to avoid computing the special receipt (tax benefit) separately for each year.

Thoughts?

Submitted by Dick Munroe on 2 August 2009 - 12:35pm.
3

Because the tax rate assumption also lowers the federal tax rate which you probably don't want to do.

ESPlanner isn't primarily a tax planner (although it can be used in large for that sort of thing) so we don't necessarily have all the bells and whistles you'll need for every state. Frankly we never considered the possibility of pensions taxable at the federal level but not at the state level. In theory we could add such a thing to the interface but there are other things more pressing at hand at the moment.

Best,

Dick Munroe

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