I see from a previous response from Stuart that "100% of SSI is deductible; RMDs and private pensions are deductible up to a combined total of $20,000 per taxpayer; military and government pensions are fully deductible. Pralana always assumes the standard deduction."
I have a NY Pension that is not subject to state tax. I perform Roth conversions of $20k per year which are not taxed due to the $20,000 exclusion. So these are 2 separate items/exclusions. Is there a way to exclude my pension entirely from NY State tax in the platform? And have it exclude the $20,000 conversion as well as the first $20,000 of RMDs in the NY tax calculation?
@atacama88 We currently have our database set up such that military and government pensions are fully deductible in NY, but that private pensions are subject to the $20K limit per person along with distributions from retirement accounts. If this is incorrect, please let me know, but in the meantime you can change your pension type to either military or government to get that deduction. Regarding Roth conversions and RMDs, Pralana definitely does apply the $20K limit to the combination of these but I cannot really discern from your question if you think these should BOTH be allowed up to the $20K limit. Please clarify.
Thanks,
Stuart
Thank you. I have a NYSTRS (Teacher's) pension which is not subject to NY state income tax. So if I set the pension to Government, it will be taxed at the Federal level only?
My pension will be tax free in NY State as will the first 20,000 distributed from my IRA after the day I turn(ed) 59.5. But if I do a distribution and conversion, the limit of $20,000 would apply and not be doubled.
@atacama88 Yes, that's correct: a Government pension should not be taxed at the State level in NY. And all distributions from your tax-deferred account will be capped at $20,000. Let me know if this does not appear to be happening. Thanks.
Stuart
