Partly taxed
How New York taxes retirement income
New York does not tax Social Security. Pensions from New York State and local governments, including NYSTRS, NYSLRS and New York City systems, are fully exempt, and so are federal government pensions. A retired New York teacher or state worker pays no state income tax on the pension at any age.
Other retirement income gets a smaller break. From age 59½, each person can exclude up to $20,000 a year of private pensions, annuities, IRA withdrawals and payments from 401(k) and 403(b) plans. Pensions from other states’ public systems fall into this group too, so a teacher who moves to New York with a New Jersey or Connecticut pension gets the $20,000 exclusion, not a full exemption.
Income above the exclusion is taxed at rates from 4% to 10.9%, and New York City and Yonkers residents pay local income tax on top.
New York public pensions
For the formula, payment dates and raises in your plan, see NYSTRS and NYSLRS.
Questions
Does New York tax NYSTRS or NYSLRS pensions?
No. New York State and local government pensions are fully exempt from state and city income tax.
Does New York tax 401(k) and IRA withdrawals?
Only above $20,000 a year per person, once you are 59½.
Is a pension from another state taxed in New York?
Yes, above the $20,000 exclusion. Only New York and federal public pensions are fully exempt.