Solved: Is my pension not taxable now that I am retired now and have no wages reported in line 7? Last year the full amount was taxable on 16.
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Is my pension not taxable now that I am retired now and have no wages reported in line 7? Last year the full amount was taxable on 16.

 
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New Member

Is my pension not taxable now that I am retired now and have no wages reported in line 7? Last year the full amount was taxable on 16.

Im sure you wish the answer was simple- but it is not. The federal government taxes pensions differently than the states do. As far as the federal taxes are concerned, there are two things that determine the taxability of pension income. The first is the quantity of the income income you receive from the pension. If you do not receive an amount that would be taxable if it were "regular" income-then it is not taxable. Lets presume that the amount of pension income exceeds that threshold-then you have to determine the nature of the pension received. In most cases, the pension is taxable-but if it is actually a distribution of after-tax contributions- then it is not. The best (probably only) way to determine this is to contact the financial entity that handles your pension. They should be able to tell you precisely whether or not the pension qualifies as taxable income. The same is true of your state- some states do not tax any pensions-regardless of source- others do. After you get your answer from the disbursing institution (bank/brokerage, etc.) then you should contact your states' department of revenue.

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New Member

Is my pension not taxable now that I am retired now and have no wages reported in line 7? Last year the full amount was taxable on 16.

Im sure you wish the answer was simple- but it is not. The federal government taxes pensions differently than the states do. As far as the federal taxes are concerned, there are two things that determine the taxability of pension income. The first is the quantity of the income income you receive from the pension. If you do not receive an amount that would be taxable if it were "regular" income-then it is not taxable. Lets presume that the amount of pension income exceeds that threshold-then you have to determine the nature of the pension received. In most cases, the pension is taxable-but if it is actually a distribution of after-tax contributions- then it is not. The best (probably only) way to determine this is to contact the financial entity that handles your pension. They should be able to tell you precisely whether or not the pension qualifies as taxable income. The same is true of your state- some states do not tax any pensions-regardless of source- others do. After you get your answer from the disbursing institution (bank/brokerage, etc.) then you should contact your states' department of revenue.

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