What's happening
This bill increases the cap on the amount of pensions and annuities that can be subtracted from gross income from $20,000 to $30,000 for New York state income tax purposes.
Why it matters
Expanding the income exclusion for pensions and annuities from $20,000 to $30,000 means retirees can shield more of their retirement income from New York State taxes, potentially increasing their disposable income and improving their financial security.
By raising the cap, the bill could make New York a more attractive state for retirees, possibly impacting decisions about whether to remain in-state after retirement or move elsewhere for tax reasons.
The change applies to a wide range of retirement income sources—including traditional pensions, IRAs, and certain retirement plans—so it benefits a broad spectrum of retirees, not just those with employer-sponsored pensions.
Since the exclusion is per individual, joint filers (such as married couples) could both benefit from the higher cap, doubling the potential tax-free amount and thereby offering significant tax relief for retired households.
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Who cares
Headline styles
Increase Pension Tax Deduction
Plain English, a few words. Used as the page title.
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History
- Referred to ways and means
- Referred to ways and means
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2997
2017-2018 Regular Sessions
IN ASSEMBLY
January 23, 2017
Introduced by M. of A. BARNWELL -- read once and referred to the Committee on Ways and Means
AN ACT to amend the tax law, in relation to raising the cap on the amount of pensions and annuities which can be subtracted from gross income
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Paragraph 3-a of subsection (c) of section 612 of the tax law, as amended by section 3 of part I of chapter 59 of the laws of 2015, is amended to read as follows:
(3-a) Pensions and annuities received by an individual who has attained the age of fifty-nine and one-half, not otherwise excluded pursuant to paragraph three of this subsection, to the extent includible in gross income for federal income tax purposes, but not in excess of [twenty] thirty thousand dollars, which are periodic payments attributable to personal services performed by such individual prior to his retirement from employment, which arise (i) from an employer-employee relationship or (ii) from contributions to a retirement plan which are deductible for federal income tax purposes. However, the term "pensions and annuities" shall also include distributions received by an individual who has attained the age of fifty-nine and one-half from an individual retirement account or an individual retirement annuity, as defined in section four hundred eight of the internal revenue code, and distributions received by an individual who has attained the age of fifty-nine and one-half from self-employed individual and owner-employee retirement plans which qualify under section four hundred one of the internal revenue code, whether or not the payments are periodic in nature. Nevertheless, the term "pensions and annuities" shall not include any lump sum distribution, as defined in subparagraph (D) of paragraph four of subsection (e) of section four hundred two of the internal revenue code and taxed under section six hundred three of this article. Where a
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06536-01-7
A. 2997 2
husband and wife file a joint state personal income tax return, the modification provided for in this paragraph shall be computed as if they were filing separate state personal income tax returns. Where a payment would otherwise come within the meaning of the term "pensions and annuities" as set forth in this paragraph, except that such individual is deceased, such payment shall, nevertheless, be treated as a pension or annuity for purposes of this paragraph if such payment is received by such individual's beneficiary.
§ 2. This act shall take effect on the three hundred sixty-fifth day after is shall have become a law.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.