NYS Pension & Annuity Calculations

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herb007
herb007 Member Posts: 1 Newcomer

On the NYS Tax Return screen entitled 'Tell us about your New York State or government pension' why does it show Taxable IRA Distributions in addition to Taxable Pensions and Annuities, and what do you enter for the NY Subtraction? Why doesn't the software calculate the subtraction? What is the subtraction?

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  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 247
    edited March 5
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    Hello Herb007,

    New York allows for subtractions from New York income, certain Taxable IRA Distributions and Taxable Pensions and Annuities.

    Generally, this subtraction is limited to government retirement where you made contributions to that pension or IRA. We do the calculation for your NY return, but we need a little more information from you to make sure your particular pension or IRA qualifies for the subtraction from NY income. There is some help on that page. Click on the "?" at the end of each question to get tax help and an explanation. Then we need the amount of the pension that qualifies on a following page. The amount you enter is the amount of your IRA or Pension that qualifies for the Subtraction.

    For more information see: https://www.tax.ny.gov/forms/html-instructions/2023/it/it201i-2023.htm#nys-subtractions

    I am sorry we don't do it automatically for you. We just don't have that ability since there are certain requirements that we cannot automatically gather.

    Also, New York has a retirement exclusion if you do not qualify for the IRA and Pension Subtraction. See the following page that asks about, "Your Pension and Annuity Income Exclusion".

    I hope that answers your question.