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Retirement tax questions
It actually depends.
If you did not have a choice and were required to make contributions to the pension plan, then according to this release from Hawaii, those contributions are to be considered nonvoluntary and are treated as if they were made by the employer. On pension plans that are fully funded by an employer, those distributions are exempt from taxation within Hawaii as referenced in this source.
A more recent code release can be found here. It states that if your employer funds the pension, then it is not taxable in Hawaii. The form instructions on page 13 here state that as well.
On the other side, if your contributions to the pension plan were voluntary, then you would be required to pay tax on the portion of the contribution made by your employer and report this taxable amount on Schedule J. The Cornell link previously provided provides the ratio but essentially, the taxable amount would be calculated by dividing the employer contribution by the sum of the employer contributions, previously taxed contributions, and the employee contribution. This ratio would then be multiplied by your yearly distribution to determine the amount taxable within Hawaii.
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