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Likely. To confirm, review your PA state taxes and see if the income is included in your taxable income.
To be excluded from PA income, it must be a qualified retirement plan meeting all of the following conditions:
A qualified plan has four characteristics:
1. The plan is reduced to writing and has been communicated to the participants.
2. The plan establishes eligibility requirements for separation of service or a combination of old age or infirmity, and long-continued service.
3. The plan provides for payments to be made at regularly recurring intervals after their separation from service by retirement which continues at least until death. An option for a lump sum payment or payments does not disqualify the retirement nature of the plan as long as the other provisions are provided.
4. The plan does not permit the distribution of program benefits to any employee until termination of employment except for incidental disability benefits or the return of the employee’s previously taxed contributions and income or gains if the employee is required to contribute to the pension plan.
If the pension program is a SEP, a Keogh, a federally qualified tax sheltered annuity program or a tax deferred custodial account, an additional provision must be included in the written provisions to be a qualified pension program.
·Program benefits cannot be paid before retirement, death, disability, separation from service unforeseeable emergency or attaining the age of 59 ½ without a substantial penalty for early withdrawal.
Likely. To confirm, review your PA state taxes and see if the income is included in your taxable income.
To be excluded from PA income, it must be a qualified retirement plan meeting all of the following conditions:
A qualified plan has four characteristics:
1. The plan is reduced to writing and has been communicated to the participants.
2. The plan establishes eligibility requirements for separation of service or a combination of old age or infirmity, and long-continued service.
3. The plan provides for payments to be made at regularly recurring intervals after their separation from service by retirement which continues at least until death. An option for a lump sum payment or payments does not disqualify the retirement nature of the plan as long as the other provisions are provided.
4. The plan does not permit the distribution of program benefits to any employee until termination of employment except for incidental disability benefits or the return of the employee’s previously taxed contributions and income or gains if the employee is required to contribute to the pension plan.
If the pension program is a SEP, a Keogh, a federally qualified tax sheltered annuity program or a tax deferred custodial account, an additional provision must be included in the written provisions to be a qualified pension program.
·Program benefits cannot be paid before retirement, death, disability, separation from service unforeseeable emergency or attaining the age of 59 ½ without a substantial penalty for early withdrawal.
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