10 May Where do I get the pension exclusion on tax forms?

Q. I’m 63, retired and a New Jersey resident. I have almost $60,000 in IRA, 401(k) and immediate annuity payments in 2018. For my 2018 tax return, it appears I am entitled to $45,000 pension exclusion as my total income is less than $100,000. However, the New Jersey Worksheet E on Page 22 of the instructions indicates that if my income was greater than $3,000, I’m not eligible. What gives?
— Taxpayer

A. You’re correct that New Jersey’s pension exclusion is $45,000 for singles who earn less than $100,000 in 2018.

For this, you’d look at your total income on Line 27, said David Ritter, chair of the tax practice at Brach Eichler in Roseland.

“Worksheets D and E in the institutions are with respect to the Unclaimed Pension Exclusion,” Ritter said. “This is a separate exclusion which you would not qualify for if your income on Line 5 of the Worksheet exceeds $3,000.”

So the good news? It appears you’re still entitled to the $45,000 exclusion, he said.

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This story was originally published on May 10, 2019.

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