topic Can I take the Pension Income Deduction if I live in Maine, am 64 years old and get a pension from my previous employer along with withdrawing money from a 401k? in Retirement tax questions

Can I take the Pension Income Deduction if I live in Maine, am 64 years old and get a pension from my previous employer along with withdrawing money from a 401k?

cnichols30 — Thu, 05 Feb 2026 12:56:54 GMT

Re: Can I take the Pension Income Deduction if I live in Maine, am 64 years old and get a pension...

Vanessa A — Thu, 05 Feb 2026 18:16:50 GMT

It depends. There is not a specific age requirement for the Pension Income Deduction. It is based on the type of retirement you are receiving and the rules to be eligible for that plan.

The maximum amount of the deduction is $48,216 per individual.

There is an income phase-out for eligibility for the pension exclusion. If your federal adjusted gross income is more than $125,000 and you are single or married filing separately then the deduction begins to phase out. The deduction is NOT available if your federal AGI is over $225,000 if single or MFS. So depending on the amount of your 401k withdrawal, you may or may not qualify for some or all of the exclusion.

Re: Can I take the Pension Income Deduction if I live in Maine, am 64 years old and get a pension...

cnichols30 — Thu, 05 Feb 2026 22:38:15 GMT

So, if I understand correctly, I can take the full amount if I took money from my 401k of $18,000 from Fidelity and pension from my previous employer (not state employee) under $35,000. My total is not over $125,000 being single. Thank you!

Re: Can I take the Pension Income Deduction if I live in Maine, am 64 years old and get a pension...

DawnC — Thu, 05 Feb 2026 22:57:04 GMT

That is correct. Maine Pension income deduction >> Benefits received under a military retirement plan, including survivor benefits, are fully exempt from Maine income tax. In addition, a taxpayer and spouse may each deduct up to $48,216 of other eligible pension income that is included in federal AGI. The $48,216 cap must be reduced by any Social Security and railroad retirement benefits received, whether taxable or not.

– Deductible pension income includes all federally taxable pension income, annuity income and individual retirement account distributions, excluding Maine PERS pick-up contributions for which a deduction is allowed and income from 457(b) plans received prior to age 55 that is not part of equal periodic payments over the life of the recipient and designated beneficiary.