Questions & Answers

Do I qualify for the Maryland pension exclusion?

If you had taxable pension or retirement annuity income on your federal return, you may be able to subtract some of it on your Maryland return.

To qualify, you must have been 65 or over or totally disabled, or if married, your spouse was totally disabled, on the last day of the tax year.

To be considered totally disabled, you must have a mental or physical impairment which prevents you from engaging in substantial gainful activity. You must expect the impairment to be of long, continued, or indefinite duration or to result in your death.

Each taxpayer is allowed to exclude up to $34,300 of taxable pension income. Please note that traditional IRAs, Roth IRAs, simplified employee plans (SEPs), Keogh plans, ineligible deferred compensation plans, some non-qualified annuities, and foreign retirement income do not qualify for this exclusion.

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