Indiana former resident’s retirement income not subject to state tax
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Thursday, April 25, 2019

Indiana former resident’s retirement income not subject to state tax

By Payroll and Entitlements Editorial Staff

Retirement income received by a former Indiana resident was not subject to Indiana personal income tax because the income was sourced to another state (Florida). In this matter, the taxpayer’s previous Indiana employer withheld state and local taxes on his retirement income. However, the taxpayer sought a tax refund claiming that the income constituted supplemental retirement pay taxable in his state of residence, Florida. It was noted that the taxpayer received the income pursuant to a retirement benefit plan which met the requirement under the applicable statute. Further, under Indiana and federal laws, the income was not subject to taxation in Indiana because it was sourced to Florida. Accordingly, the taxpayer’s protest was sustained. (Indiana Department of Revenue, Memorandum of Decision: 01-20182119R, November 28, 2018, released February 2019.)

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