Does PA tax retirement pensions?

[wjohns331]

After I completed my retirement income your program showed an amount due to the state of PA for 206.00. This may be an error since PA doesn't tax retirement income.

[re2boys]

While going through the PA interview (see below) you are asked what type of retirement income each 1099R represents.  You choice will determine if that income is taxable to PA.  PA does not have a blanket exemption on retirement income.

If box 7 of the 1099R is coded 4 or 7, it is not taxable in PA.

If box 7 is coded with a D, such as 1D or 7D, it is a commercial annuity and is taxable same as federal.

If box 7 is coded a 1 or 2, it is an early distribution and is taxed to the extent your distribution exceeds your basis in the retirement plan.