Are pensions and annuities taxable?

In Arizona, the answer to the question “Are pensions and annuities taxable?” is yes, they are generally taxable. Generally, when you receive a pension or annuity, some or all of the payments you receive will be taxable. However, it is important to note that the taxable amount can vary depending on the specific type of pension or annuity you have. When it comes to pensions, any distributions from a qualified pension or annuity are taxable as income at your ordinary income rate. This applies to qualified plans such as 401(k)s, 403(b)s, profit-sharing plans, IRAs, and defined benefit plans. When it comes to annuities, it is important to note that not all annuities are taxable. An annuity purchased with after-tax money is not taxable, while an annuity purchased with pre-tax money may be taxable. In addition, when the annuity is paid out over time, each payment is subject to income tax. It is important to keep in mind that when it comes to pensions and annuities, each situation can be different. It is important to speak with a tax professional to determine your exact tax liability.

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Are pensions and annuities taxable?

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