What are Qualifying Retirement and Pension Benefits?

Retirement and pension benefits include most income that is reported on Form 1099-R for federal tax purposes. This includes defined benefit pensions, IRA distributions, and most payments from defined contribution plans.

Generally, deferred compensation income is not included in the definition of retirement and pension benefits and therefore, does not qualify for special tax treatment.

Treasury uses the terms “retirement” and “pension” interchangeably unless addressing a specific situation applicable only to one type of income.