Certain Pension Income Excluded From New York Taxable Income
If you received a pension payment from New York State, local government, the federal government (including SS benefits) or from certain public authorities, it is not taxable in New York.
In addition, income from pension plans described in section 114 of Title 4 of the U.S. code received while you are a nonresident of New York State is not taxable to New York.
If your pension IS taxable in NY, but you are over age 59 ½ or turn 59 ½ during the tax year, you may qualify for a pension/annuity exclusion of up to $20,000. This only applies to pensions that are included in your federal adjusted gross income.
NOTE: You cannot subtract the following:
- Pension payments or return of contribution that were attributable to your employment by an employer other than a NY public employer, such as a private university, and any portion attributable to contributions you made to a supplemental annuity plan which was funded through a salary reduction program.
- Periodic distributions from government deferred compensation plans. However, these payments and distributions may qualify for the other pension and annuity income exclusion in NY not associated with the NYS and local governments and the federal government.
Disability Income Exclusion
Your disability income can be excluded of up to $20,000. You may exclude your disability income from your New York tax return if you meet ALL of the following tests:
- You received disability pay.
- You were not 65 when the tax year ended.
- You retired and were permanently and totally disabled.
- On January 1 of this tax year, you had not yet reached the age when your employer’s retirement program would have required you to retire.
- If you were married at the end of this tax year and filed as Married filing separate return, on your federal and New York State returns, you may claim the disability income exclusion only if you and your spouse lived apart during the entire tax year.
To enter these exclusions on your New York return, follow the steps below:
- State Section
- Subtractions from Income
For additional information see IT-201 Instructions.