PENSION AND ANNUITY INCOME EXCLUSION If you were age 59 before January 1, 2005, enter the qualifying pension and annuity income included in your 2005 federal adjusted gross income, but not more than $20,000. If you became 59 during 2005, enter only the amount received after you became 59, but not more than $20,000.
Do not enter any pension income you received from New York State, local governments within the state, and the United States here.
Qualifying pension and annuity income includes: * periodic payments for services you performed as an employee before you retired; * periodic and lump-sum payments from an IRA, but not payments derived from contributions made after you retired; * distributions from government (IRC section 457) deferred compensation plans, after December 31, 2003; * periodic distributions from an annuity contract (RC section 403(b)) purchased by an employer for an employee and the employer is a corporation, community chest, fund, foundation, or public school; * periodic payments from an HR-10 (Keogh) plan, but not payments derived from contributions made after you retired; * lump-sum payments from an HR-10 (Keogh) plan, but only if federal Form 4972 is not used. Do not include that part of your payment that was derived from contributions made after you retired; * distributions of benefits from a cafeteria plan (IRC section 125) or a qualified cash or deferred profit-sharing or stock bonus plan (IRC section 401(k)), but not distributions derived from contributions made after you retired.
If you and your spouse both qualify, each of you can subtract up to $20,000 of your own pension and annuity income. However, you cannot claim any unused part of your spouse's exclusion.
If you received the pension and annuity income of a decedent, you may make this subtraction if the decedent would have been entitled to it, had the decedent continued to live, regardless of the age of the beneficiary. If the decedent would have become 59 1/2 during 2005, enter only the amount received after the decedent would have become 59 1/2 but not more than $20,000.
The maximum exclusion allowable, from the total of all sources that qualify for the exclusion, may not exceed $20,000. If you are also claiming the disability income exclusion, the total of your pension and annuity income exclusion and disability income exclusion cannot exceed $20,000. For more information, see Publication 36, General Information for Senior Citizens and Retired Persons.