Taxation on Pensions
It would be nice to specify if a pension is exempt from federal or state income tax. The current workaround is to reduce the federal or state taxes when the pension starts.
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Probably ought to post this in the support forum to make sure it gets considered for inclusion in the product.
Best,
Dick Munroe
You may want to include partial exemptions as well. Some pensions may have X% or $Y exempt from Federal/State taxes.
On the same topic regarding taxation of pension annuities, ther are states that exempt withdrawals from tax deferred pension accounts from taxation. As an example, Illinois does not tax withdrawals from IRAs, 401Ks etc. It would be appropriate to be sure minimum required distributions from these accounts were not being treated as taxable by ESPlanner in its simulations.
In general we do the right thing modulo bugs if there is a complete exclusion or inclusion of various things (including SS benefits, IRA distributions, etc) in the state tax code. It's the "partial" and "conditional" stuff that we don't have enough information to figure out.
Best,
Dick Munroe