Are IRA distributions subject to Pennsylvania state tax because I am still working?

Jan 01, 2013
askacpaicon I am receiving the required minimum distributions from IRAs established many years ago when I was working in a different field. I currently have some earned income from self-employment. Are the IRA distributions taxable by Pennsylvania because I am still working?

Distributions from IRAs are not taxable by the Commonwealth of Pennsylvania. When you contribute to a deductible IRA, 401(k), 403(b), or any other qualified retirement plan, you do not get a state tax deduction for your contribution. Therefore, when you withdraw money from your retirement plan, it is considered to have already been taxed by Pennsylvania, and no tax is due on any distributions in retirement. The fact that you are now working in retirement has no effect on the taxability of IRA distributions.

Answer By: Virgil A. Kahl, CPA, is a financial planner with Spring Ridge Financial Group in Wyomissing.
Pennsylvania CPA Journal

Read the latest from the Pennsylvania CPA Journal online or via the mobile app and digital edition.

Read More


Get the latest info on professional trends, management, and leadership skills on CPA Now.

Read More

PICPA 2019 Premier Sponsors

Platinum Sponsor

Gallagher Bollinger Logo CPACharge

Gold Sponsor

Paychex logo

Bronze Sponsor


Interested in becoming a sponsor? Contact Kelli Comegys for packages and opportunities.