About PA taxes. We have pensions from schools. Drop down reason for income exempt from state taxes lists PA School. Does this apply to registered private schools?

magster831 · ‎June 6, 2019

We retired from private Catholic schools registered with the State of PA. In entering the income for 2017, the majority of it is from pension plans and 403(b) payouts from the school. One of the state return questions asks for qualification of the income to see if it is exempt from taxes. One of the drop down is PA School. Does a private school registered in the state qualify for the exemption?

IreneS · ‎June 6, 2019

The instructions for the PA-40 state: "Pennsylvania does not impose income tax on payments you receive that are commonly recognized retirement benefits distributed from eligible employer-sponsored retirement plans."

Your pension income should be exempt from PA income tax. To indicate this in TurboTax, on the screen, What kind of retirement income do you have from Pennsylvania:

If your retirement is from a state or local school system choose PA school, state, or muni employee plan.

If your school is not part of the municipal school system (which it sounds like it isn't), select: I'm eligible; plan's eligible (no PA tax)

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About PA taxes. We have pensions from schools. Drop down reason for income exempt from state taxes lists PA School. Does this apply to registered private schools?

Retirement tax questions