You onl
y pay state income tax to the state where you live, not the state where you earned or qualified for the pension.
Effective for
retirement income received after December 31, 1995, federal law prohibits any
state from taxing certain retirement income (mainly pension income) unless you
are resident of, or domiciled in, that state. For example, if you receive a
pension from your former California employer and you now reside in New Mexico,
California may not tax your retirement income. Because you are now a New Mexico
resident, your retirement income is taxable in New Mexico.
