Are pensions taxed in hawaii? Why is my wife's pension not excluded?

[don-808]

My wife's pension is from the State of Hawaii and was excluded last year with turbo tax, why not this year?

[Patrice]

The good news is that public pension income is totally tax exempt in Hawaii. The bad news is that all other forms of retirement income are taxed and are not eligible for any kind of deduction.  Hawaii entirely exempts some types of retirement income (including Social Security retirement benefits and public pension income) but fully taxes income from private pensions and retirement savings accounts.

[Hawaii-EA]

This is not correct. Employer funded retirement is not taxable.
Nontaxable Distributions
The following lines describe what qualifying
distributions are. These qualifying distributions
were included in your federal AGI and
will be excluded on this line. For a distribution
to qualify, it must be paid by a pension plan by
reason of retirement, disability, or death. The
pension plan does not have to be a “qualified
plan” as defined in section 401 of the Internal
Revenue Code.
 Employer-Funded Pension Plans
The following three types of distributions
are not taxed by Hawaii and should be included
on line 13:
(1) Pension or annuity distributions from a
public (i.e., government) retirement system
(e.g., federal civil service annuity, military
pension, state or county retirement system).
(2) Distributions from a private employer
pension plan received upon retirement (including
early retirement and disability retirement)
if the employee did not contribute to the
pension plan.
(3) Distributions from a pension plan at
age 70-1/2 that are made to comply with the
federal mandatory payout rule do qualify as
a retirement payment whether or not the employee
is still working full time.
Distributions from a private employer pension
plan received upon retirement are partially
taxed by Hawaii if the employee contributed
to the pension plan.

[SweetieJean]

See page 14 here:
<a rel="nofollow" target="_blank" href="http://files.hawaii.gov/tax/forms/2017/n11ins.pdf">http://files.hawaii.gov/tax/forms/2017/n11ins.pdf...>

[adshiroma]

My husband has retirement from Pension Trust Fund for Operating Engineers but not sure whether that is taxable or non-taxable in Hawaii.  With the answer you have, it sounds like it is not taxable in Hawaii.  Is that true?

[DaveF1006]

It depends if the pension for operating engineers is a public or private pension.  If it is a private pension, then it is taxable in Hawaii. i have tried to search to see if i could find the answer but could not locate a definitive answer. Here is the Turbo Tax link, that addresses public and private pensions.A private pension is a plan into which individuals contribute from their earnings, which then will pay them a private pension after retirement.

[jmpatrickreynolds]

Help me out here.  I'm confused.  Is a state pension from Illinois, that I and my employer contributed to for many years tax exempt in Hawaii or not?

Thanks,

Jim

[TomD8]

@jmpatrickreynolds --

Hawaii Revised Statute 235-7 (3) excludes from taxation "Any compensation received in the form of a pension for past services."

https://law.justia.com/codes/hawaii/2019/title-14/chapter-235/section-235-7/

[pdukes1]

Members of Operating Engineers Pension Trust fund is fully funded by the employer so the retirement income by its member s are not taxable in Hawaii.

[DaveF1006]

As you prepare your Hawaii state tax return, there will be a screen that says Exclusion Amount. Here it will tell you to enter the non-taxable amount of your exclusion. Here you will enter the full amount of the distribution. Entering this will not affect your federal return.

@jmpatrickreynolds