Yes, you are correct. Distributions received as a result of an annuity contract purchased with your own funds from an insurance company or other financial institution are not qualified. The payments are attributable to premium payments made by you, from your own funds, and are not attributable to personal services performed. These types of 1099-R distributions are not qualified for the exclusion of $20,000.
Please follow the instructions below to remove the exclusion from your state return:
- Open your return.
- Search 1099-R with the magnifying glass tool.
- Select the Jump to link at the top of the search results.
- Edit your 1099-R.
- Continue past the information entered.
- On the page titled, What kind of retirement plan do you have?, select Non-qualified plan. This includes Includes life insurance policies, private or purchased commercial annuities, and military retirement plans.
- Your exclusion will be removed from your NYS return.
Publication 36 - General Information for Senior Citizens and Retired Persons
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