County Retirement 414(h)(2)

[Marie]

Client's W-2 has this number with an amount listed in box 14. Wages have been reduced by this amount. Does this qualify for the retirement credit?

[cientax]

Client's W-2 has this number with an amount listed in box 14. Wages have been reduced by this amount. Does this qualify for the retirement credit?

No! I had one with the same thing two weeks ago and I googled it while the client was here and found that it is not eligible for the credit. I believe I found it at the irs web site but it gave me many sites to go to when I google it. My client also works for a county office.

[Terry O]

Not only is it NOT eligible for the credit - -it absolutely MUST be added back into the NYS wages!!

I believe it's a 414 non exemt. If you do not add this back, the client will get a wonderful letter in about 8 mos.

And, for the record, almost ALL NYS employees who have this 414 contribution owe NYS taxes. You can reassure them though, that NONE of their pension will be taxable in NYS.

[cientax]

Not only is it NOT eligible for the credit - -it absolutely MUST be added back into the NYS wages!!

I believe it's a 414 non exemt. If you do not add this back, the client will get a wonderful letter in about 8 mos.

And, for the record, almost ALL NYS employees who have this 414 contribution owe NYS taxes. You can reassure them though, that NONE of their pension will be taxable in NYS.

The reason the taxpayer is not allowed a credit, even though they made the contribution from their wages, the employer can "pick up" the contribution and treat it as if they (the employer) made the contribution to the plan. The information should be in box 14 of the W-2 and is for information purposes only. You can read all about how the plan works in the irs web site in the IRB. I don't know which IRB it is, like isaid earlier, I just googled it.