Pension Tax Question
If someone have a pension and rolls it over to an IRA does that immediately do away with state tax benefits? A clients tax preparer said that if he had kept it in the pension he wouldn’t have had to pay taxes on the distributions.
Permalink Submitted by David Mertz on Tue, 2023-05-09 17:25
Depends on the state. If the state does not exempt IRA distributions from taxation but has an exclusion for pension distributions, rolling the funds over to an IRA would result in the loss of the pension exclusion.