Retirement tax questions

A pension is not eligible for exclusion if it is not a distribution received by officers and employees of the United States, New York State, or local governments within New York State. These types of pensions are fully exempt from New York State, New York City, and Yonkers income taxes. 

Any other type of pension may qualify for a pension and annuity exclusion of up to $20,000 in NYS, as long as your pension is taxable to New York, and you are over the age of 59 ½ or turn 59 ½ during the tax year. If married filing jointly, each spouse may deduct up to $20,000, which would total $40,000 per tax year. 

The adjustment to exclude $20,000 from your NYS pension is done under Wage and retirement adjustments. This is found on the NYS screen Changes to Federal Income. 

You can follow these steps in TurboTax to get to the correct NYS screen:

1. Open your return.
2. Click on State in the left hand column.
3. Click Edit next to your resident return.
4. Click Update or Start next to Adjustments to federal income on the screen You Just Finished Your New York Return.
5. Scroll down to Wage and retirement adjustments.
6. Click Start next to Received retirement income. 
7. Follow the on-screen instructions. 

For more information, please see Publication 36.