Q. My husband and I are both retiring in 2017. We are both honorably discharged veterans and retired law enforcement. We still have two children in high school. Are there any exemptions that we are entitled to? Are our pensions fully taxed?
A. It’s hard to delve into all the exemptions or deductions to which you may be entitled without knowing more about you.
But you are correct in your assumption that your pensions are fully taxable at the federal level unless you are receiving a veteran’s pension due to a disability, said Altair Gobo, a certified financial planner with U.S. Financial Services in Fairfield.
But you do have some benefits to explore in New Jersey.
“The state of New Jersey allows married couples to exclude up to $40,000 of pension income in 2017 providing you are both over the age of 62 and your total income, including the $40,000 excluded, does not exceed $100,000,” Gobo said.
The amount of the exclusion will go up $20,000 a year until it reached a maximum of $100,000 in 2020.
Gobo said other than the personal exemptions that you are entitled to for your two children, and for yourselves, there are no other special exemptions available at this time.
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