Income tax withholding from annuities

If an annuitant files Form IT-2104-P, with the payer, the payer must withhold the amount specified, provided that the New York State tax withheld is not less than $5 per month, and if applicable, New York City or Yonkers tax withheld is not less than $5 per month, and does not reduce the annuity payment to less than $10.

To qualify for withholding, the annuity or pension payment must be income to the recipient that would be includable in their New York adjusted gross income. The annuity or pension must also be payable over a period longer than one year. The request for withholding will remain in effect until terminated in writing by the payee.

A payer of annuities is subject to the same remitting and reporting requirements as employers if a payee has requested withholding for New York State, New York City, or Yonkers income tax.

Pension and annuity income (reported on federal Form 1099-R) must be reported quarterly as Other wages on Form NYS-45 if the payer withholds New York State, New York City, or Yonkers income taxes from the distribution(s).