State tax treatment of federal annuities

[Osprey]

http://www.narfe.org/pdf/StateTaxRoundupTaxYear2015.pdf

Does anyone know if North Carolina tax treatment for tsp withdrawals continues to be the same for the surviving spouse?


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[Osprey]

The article is addressing how different states tax the defined benefit retirement plans of the federal government, FERS and CSRS. It is not specifically applicable to TSP withdrawals. TSP is a defined contribution plan, very similar to a 401k plan.

NC uses federal AGI as the starting point. A quick look at the NC instructions does not show any adjustments allowed to the AGI for TSP or any other type of defined contribution plan. It appears that any TSP withdrawals are taxed by NC as income same as federal.

For people who have 5+ years of federal service befor 1989, csrs pension and tsp withdrawals I believe are not taxed under Bailey decision. My question is whether surviving spouse tsp withdrawals would continue to receive the same treatment.



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[RE2Boys]

Call the NC Dept of Revenue. Further research shows the TSP is subject to the Bailey decision but don't know about survivor benefits.

 

[Osprey]

Call the NC Dept of Revenue. Further research shows the TSP is subject to the Bailey decision but don't know about survivor benefits.

Thanks for looking into my question. Great idea to call the NC revenue dept!


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