Seven (7) questions about personal individual state income tax for retired, full-time residents of the state of Pennsylvania

[david787]

Seven (7) questions about personal individual state income tax for retired, full-time residents of the state of Pennsylvania:

I am 71 years old (birthdate: 5/17/1952), May 2018 I fully retired from all employment (from career-long employment as a university dean/professor), and since May 2018 I have NO EMPLOYMENT / NO EMPLOYMENT INCOME. 

In 2023, I'm very likely to move permanently to Pennsylvania (from Texas where I currently live full time) and with that relocation I would live full-time permanent resident in Pennsylvania (most likely Pittsburgh, PA, area).  I would NOT buy any house and NOT buy any condo, but only rent an apartment or condo unit.  About the only tangible asset that I would buy in PA would be a car/SUV.

I have been told and I have read that in Pennsylvania an individual resident needs only to pay PA state income tax on "employment income" (which I have none), but still must file annually a PA state income return.  Please note that although (since May 2018) I am no longer employed and thus I receive no employment income, I do have an annual income of around $200,000 from non-employment/non-working sources as I list below, which includes a pension payment of about $45,000 annually (from CalPERS) related to my employment at a California state/public university from 1995-2003.

Seven (7) questions:  As a 71 year-old retired full-time permanent resident of Pennsylvania, would I have to pay personal Pennsylvania state income tax on any (and which) of the following seven (7) financial items from which I receive payments now in my years of retirement till death:

(1)  Interest ?  ----This interest is from bank savings account, brokerage Money Market account, for which I receive about $5,000 to about $10,000 annual income.

(2)  Dividends ?  ----This dividends' amount annually is not really predictable, but dividends from stocks, for which I receive is about $2,000 to $20,000 annual income.

(3)  Capital gains regarding stock/equities investments ?  ----This amount annually is not really predictable, but capital gains from stock sales, for which I receive is anywhere between about $0.00 (zero) to $100,000 annual income

(4)  Charitable Gift Annuity payments related to 2019 donation to 501c3 nonprofit organization ?  ----These payments are from a Charitable Gift Annuity, about $250,000 annual income (from two private universities in state of California, for which I’ve made a major donation in 2019 for a Charitable Gift Annuity, which the IRS designates as donations, and for which I receive about $250,000 annual lifetime income).

   --- Footnote: In 2021 the IRS notified me of a thorough related audit of my 2019 tax year filing, and the respective TurboTax representation is wonderful and ultimately the IRS concluded all was filed and paid properly and NO additional tax payments or changes needed to be made by for my 2019 tax year filing.

(5)  Social Security retirement benefit payments to me ?  ----Payment from U.S. Social Security Administration retirement benefits, that I began at age 70 years old, for which I receive about $40,000 annual income.

(6)  Pension payments from California (CalPERS) as a former state university employee in 1990's ?   ----These payments are "pension" payments from CalPERS (California state employee retirement program) for the eight years (1995-2003) that I worked as a state/public university professor in California, and these monthly payments from CalPERS total about $40,000 annual income for me.

(7)  As I ask this final question, I am asking it in the context of IF I would need not to pay state of Pennsylvania state income tax on any of the six items above:  Would I still have to file an annual PA state income tax filing each year ?  ----Or, would this item be for me living in the state of Pennsylvania, be the same as such residents in Texas, Florida, Nevada, and such, where NO state income tax filing needs to be filed each year?

Thank you, thank you immensely if you can answer specifically/explicitly, even with a simple short yes or so, each of my seven (7) above questions.

[Critter-3]

(1)  Interest ?  ----This interest is from bank savings account, brokerage Money Market account, for which I receive about $5,000 to about $10,000 annual income.   Taxable to PA.

(2)  Dividends ?  ----This dividends' amount annually is not really predictable, but dividends from stocks, for which I receive is about $2,000 to $20,000 annual income.   Taxable to PA.

(3)  Capital gains regarding stock/equities investments ?  ----This amount annually is not really predictable, but capital gains from stock sales, for which I receive is anywhere between about $0.00 (zero) to $100,000 annual income   Taxable to PA.

(4)  Charitable Gift Annuity payments related to 2019 donation to 501c3 nonprofit organization ?  ----These payments are from a Charitable Gift Annuity, about $250,000 annual income (from two private universities in state of California, for which I’ve made a major donation in 2019 for a Charitable Gift Annuity, which the IRS designates as donations, and for which I receive about $250,000 annual lifetime income).

   --- Footnote: In 2021 the IRS notified me of a thorough related audit of my 2019 tax year filing, and the respective TurboTax representation is wonderful and ultimately the IRS concluded all was filed and paid properly and NO additional tax payments or changes needed to be made by for my 2019 tax year filing.   Taxable to PA.

(5)  Social Security retirement benefit payments to me ?  ----Payment from U.S. Social Security Administration retirement benefits, that I began at age 70 years old, for which I receive about $40,000 annual income.   See below

(6)  Pension payments from California (CalPERS) as a former state university employee in 1990's ?   ----These payments are "pension" payments from CalPERS (California state employee retirement program) for the eight years (1995-2003) that I worked as a state/public university professor in California, and these monthly payments from CalPERS total about $40,000 annual income for me.   See below 

States that may tax retirement income from IRA's, pensions, etc.:

AL, AR, AZ, CA, CO, CT, DE, DC, GA, HI, IA, ID, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MT, NC, ND, NE, NJ, NM, NY, OH, OK, OR, RI, SC, UT, VA, VT, WI, WV, 

This is a “general” list.  Some of these states have complicated laws that exclude certain types of retirement income, or provide certain income exclusions and age deductions.  This list does NOT refer to Social Security benefits.

States that tax Social Security benefits:

CO, CT, KS, MN, MO, MT, NB, NM, ND, RI, UT, VT, WV

These states offer varying degrees of income exemptions, but four mirror the federal tax schedule: MN, ND,VT, and WV

States that do not have state income tax and/or do not tax retirement income:

AK, FL, IL, MS, NV, NH, PA, SD, TN, TX, WA, WY

(7)  As I ask this final question, I am asking it in the context of IF I would need not to pay state of Pennsylvania state income tax on any of the six items above:  Would I still have to file an annual PA state income tax filing each year ?   See previous answers ... if you are a PA resident and have PA income then a PA return will be required.

----Or, would this item be for me living in the state of Pennsylvania, be the same as such residents in Texas, Florida, Nevada, and such, where NO state income tax filing needs to be filed each year?   Not the same at all. 

[Hal_Al]

@david787  said "I have been told and I have read that in Pennsylvania an individual resident needs only to pay PA state income tax on "

'employment income'".

That's not true for the state. Some PA cities (inluding Pittsburgh) have a  local earned income tax  and/or “Local Services” tax, on wages (sometimes called occupational tax or per capita tax), that may be what you heard of.  You do not need to file a Pittsburgh city return, unless you work.