For tax year 2022, Maine allows for a deduction for pension income of up to $25,000 that is included in your federal adjusted gross income. The $25,000 must be reduced by all taxable and nontaxable social security and railroad benefits. This $25,000 deduction is an increase from $10,000 that was allowed in tax year 2021, and will continue to increase for the next two tax years.
Married filers that both receive pension income can exclude up to $50,000.
Where do I enter the deduction?
- State Section
- Subtractions from Income
- Pension Income Deduction
See also Is my military pension/retirement income taxable to Maine? .