NY A05194

Expands the definition of "pensions and annuities" under New York tax law to include distributions from nonqualified pension plans that meet the requirements of the exemption, regardless of whether they are reported as wages on IRS Form W-2

Allows individuals age 59½ and older to exclude up to $20,000 annually in periodic payments from nonqualified pension plans from New York State taxable income, provided the payments arise from an employer-employee relationship or contributions deductible for federal tax purposes

Clarifies that the exemption applies to nonqualified plan distributions that would otherwise qualify as "pensions and annuities," but excludes lump sum distributions as defined in Internal Revenue Code section 402(e)(4)(A)

Preserves existing rules for married couples filing joint returns and allows beneficiaries of deceased individuals to claim the exemption if they receive qualifying pension or annuity payments

Effective date is 120 days after the bill becomes law