New Jersey General Rule method for distributions from 457(b) plan

Forum|Forum|1 year ago
March 20, 2025
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I am taking distributions from the NJ deferred comp plan (457(b) plan. Contributions to this plan were taxed in NJ. Now I have to figure out how Expected Return on Contract (Worksheet B General Rule Method) is calculated. Please help.

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MayaD

Under this method, part of your pension or annuity payment is excluded from taxes, and part of it is taxable. (The excludable portion of that year’s distribution represents your contributions.)

You must use the General Rule Method to determine your New Jersey taxable pension income when:

1. You will not recover all of your personal contributions within 36 months of the date you receive your first payment from the plan; or

2. Your employer did not contribute to the plan.

Check Worksheet B (pg.6) to determine the taxable and excludable portions of your pension or annuity payment.

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