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March 29, 2022
Question

My pension was taxable in 2020 but it's non-taxable in 2021. Did something change?

  • March 29, 2022
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For federal taxes, did state pensions become non-taxable in 2021?

1 reply

March 29, 2022

No, nothing changed as far as the taxability of state pensions. 

 

If you compare your 1099 from last year to this year, is the amount in box 2a the same as box 1 for both years?  

 

Did you enter an amount in box 2a?  If you entered $0 then you are telling TurboTax that your distribution is not taxable.  Depending on how you answered the questions that followed, you  may have also told the program your pension was not taxable. 

 

Is the code the same for both years in box 7?  

 

These two items are what determine how much your pension is taxed.  If something changed in these boxes, whether it is an accurate change or not, this will affect the taxability of your pension.

 

Best thing to do after comparing last year to this year is go back through and double check your entries and your answers. 

 

 

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