Questions & Answers

What is the Qualified Retirement Benefits Deduction?

If you're age 65 or older, or if you're disabled and age 62 or older, you may be able to deduct some of the retirement benefits and annuities you receive. You can't claim this deduction if you are Married Filing Separately.

Only the following are qualified retirement benefits:

  • Civil Service Employees: Retirement annuities paid by the United States to a retired civil service employee or the unremarried widow of the employee if the recipient is age 65 or older, or disabled and age 62 or older. Retirement annuities paid to a retired federal employee under the Federal Employees Retirement System (FERS) don't qualify for this deduction. You can tell if your benefits are paid under the CSRS or FERS by looking at the first digit of the account number shown on your CSA-1099. If the first digit is 7 or 8, the benefits are paid out of FERS and don't qualify. If the first digit is 0, 1, 2, 3, or 4, the benefits are paid out of CSRS.
  • Idaho Firefighters: Retirement benefits paid from the Firemen's Retirement Fund (FRF) of the state of Idaho to a retired fireman or the unremarried widow of a retired fireman if the recipient is age 65 or older, or disabled and age 62 or older. If you received a 1099R and your account number includes the FRF designation, your benefits may qualify for the deduction. Benefits paid out of the PERSI Base Plan don't qualify for the deduction.
  • Police Officers of an Idaho city: Retirement benefits paid from the Policemen's Retirement Fund - that no longer admits new members and, on January 1, 2012, was administered by an Idaho city or PERSI - to a retired policeman or the unremarried widow of a retired policeman if the recipient is age 65 or older, or disabled and age 62 or older. Benefits paid by PERSI relating to Idaho police officer employment not included in the federal Social Security retirement system qualify. If you received a 1099R and your account number includes the IFP (Idaho Falls Police) designation, your benefits may qualify for the deduction. However, benefits paid out of the PERSI Base Plan don't qualify for the deduction.
  • Service Members: Retirement benefits paid by the United States to a retired member of the U.S. military or the unremarried widow of such member if the recipient is age 65 or older, or disabled and age 62 or older.
The amount deducted must be reduced by retirement benefits paid under the Federal Social Security Act and the Federal Railroad Retirement Act received by you and your spouse.

Disability pension paid by the Federal Railroad Retirement Act may not be included on your Form RRB-1099 or Form RRB-1099-R, if you are under the minimum retirement age. Instead it may be included on Form 1040, Line 1 as wages.

The maximum amounts that may be deducted for 2019 are:

Married Filing Jointly:
Age 65 or older - $50,184
Age 62 or older and disabled - $50,184

Single:
Age 65 or older - $33,456
Age 62 or older and disabled - $33,456

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