If I’m retired and living in Pennsylvania, but my income is from an Ohio pension, will it be taxed by Pennsylvania?

by Paula A. Rummell, CPA | Nov 19, 2018

I am retired and live in Pennsylvania, but my income is from an Ohio pension. I understand that there is a tax reciprocity arrangement between Ohio and Pennsylvania, so how exactly am I affected?

Pennsylvania is a tax-friendly state for retirees. If you are a Pennsylvania resident, you will not pay any state income taxes on pension income or Social Security benefits. 

The reciprocity agreement between Ohio and Pennsylvania deals with employee compensation (not pension income). It does not matter if the pension income is paid by a (former) Ohio employer. The applicable state income tax depends on your current state of domicile. 

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Answered by: Paula A. Rummell, CPA, is a tax senior manager with H2R CPA in Pittsburgh. 

The responses are based on the limited information provided by the questioner and apply the laws and regulations at the time of posting. Other options could arise as rules and regulations may change over time, including but not limited to the passage of the Tax Cuts and Jobs Act of 2017. They are intended to provide general information, not specific accounting or tax advice; they are not intended or written to be used and cannot be used for the purpose of avoiding or evading taxes or penalties under the IRS code or regulations. Views expressed do not imply an opinion of the PICPA, its officers, directors, employees, or members.
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