I am a teacher in NJ, about to retire. Many years ago, I taught in NY, and then spent years in business. I have just made payments to NJ to "buy back" these NY years. Can I deduct these payments from my Fed and NJ tax?
2007-12-13 10:49:41 · 2 answers · asked by mrgathome 1 in Business & Finance ➔ Taxes ➔ United States
Yes, this is a pension plan
2007-12-13 11:16:11 · update #1
sounds like you bought credits [years] in a retirement program. if this is so, the cost is not deductible in the present year.
you might argue that the investment is expected to pay off in taxable income after you retire and so the amount you pay is added to your basis in the retirement program and than then be amortized over the expected period of payout [thus shielding some of the retirement income from taxes].
That's IF you're buying the credits with money that has already been taxed and not with untaxed funds received from a payout from a 457 plan or similar state fund in NY.
GL
2007-12-13 11:09:00 · answer #1 · answered by Spock (rhp) 7 · 0⤊ 0⤋
Are you talking about a contribution to a pension plan, or what?
2007-12-13 11:07:56 · answer #2 · answered by hottotrot1_usa 7 · 0⤊ 0⤋