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Pennsylvania Free Printable Brochure: Retirement - Traditional IRAs and Roth IRAs (REV-636) for 2024 Pennsylvania Retirement - Traditional IRAs and Roth IRAs Brochure

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Retirement - Traditional IRAs and Roth IRAs Brochure
Brochure: Retirement - Traditional IRAs and Roth IRAs (REV-636)

CONTACT INFORMATION Online Customer Service Center www.revenue.pa.gov RETIREMENT TRADITIONAL IRAs and ROTH IRAs Taxpayer Service & Information Center Personal Taxes: 717-787-8201 Business Taxes: 717-787-1064 e-Business Center: 717-783-6277 TRADITIONAL IRAs Traditional IRAs are federally allowed accounts taxpayers may set up to save for retirement. Contributions to traditional IRAs provide for federal income tax deductions, however taxpayers may also make IRA contributions without claiming deductions and when deductions are not permitted. Contributions must be made before a taxpayer becomes 70 ½ years old, and minimum distributions from an IRA are required once a taxpayer reaches that age. A retired taxpayer between 59 ½ and 70 ½ years of age may choose whether or not to receive distributions. 1-888-PATAXES (728-2937) Touch-tone service is required for this automated 24-hour toll-free line. Call to order forms or check the status of a personal income tax account or property tax/rent rebate. For federal income tax purposes, contributions to traditional IRAs lower taxable income and grow tax-free until withdrawn. Automated Forms Ordering Message Service 1-800-362-2050 Service for Taxpayers with Special Hearing and/or Speaking Needs ROTH IRAs Roth IRAs are also federally allowed accounts taxpayers may set up to save for retirement. However, contributions to Roth IRAs are not tax-deductible for federal income tax purposes, and there is no age limit for making contributions. 1-800-447-3020 Call or visit your local Department of Revenue district office, listed in the government pages of local telephone directories. Individual Retirement Accounts (IRAs) are special accounts that offer tax advantages to help taxpayers save for retirement. Generally, Roth IRA withdrawals are not taxable for federal income tax purposes, if the individual has had the retirement account for more than five years and has reached 59 ½ years of age. What are Pennsylvania’s rules regarding IRAs? Following are the most commonly applicable personal income tax rules with regard to traditional and Roth IRAs. • Contributions are not tax deductible. • Withdrawals are generally not taxable after a taxpayer reaches retirement age and retires. www.revenue.pa.gov REV-636 (PO+) 02-18 • Payments employers make for the benefit of employees directly to IRA trustees or issuers may be excluded from compensation. • IRA contributions made by, on behalf of or attributable to an employee or selfemployed person – regardless of whether the contributions were made directly or indirectly; through a payroll deduction or a salary reduction agreement; or otherwise – may not be excluded or deducted from income for PA personal income tax purposes. • Income on assets held in an IRA is not taxable. • Distributions can be considered income for PA personal income tax purposes to the extent distributions exceed the contributions to the plan when distributions are made before the IRA owner reaches 59 ½ years of age. • The cost-recovery method is used to determine the portion of distributions to be included in income. Must all distributions from IRAs be reported for PA personal income tax purposes? Yes. All IRA distributions should be reported on PA Schedule W-2S, Wage Statement Summary, whether or not some or all of the distributions are taxable. If a taxpayer receives distributions before he/she reaches 59 ½ years of age, some of the distributions may be taxable. The costrecovery method is used to determine the portion of distributions to be included in income. IRA Comparison Reference Are there differences between Pennsylvania and federal tax rules on roll-over contributions and plan conversions? Yes. For federal tax purposes, amounts rolled over into Roth IRAs from traditional IRAs are considered income. Similarly, the conversion of a traditional IRA to a Roth IRA is generally taxable for federal income tax purposes. For Pennsylvania personal income tax purposes, the following rules apply: • Amounts rolled over into IRAs from non-IRA individual retirement plans are generally considered income in the distribution year to the extent the distributions exceed contributions to the plan. • Amounts rolled over into an individual's IRA from a federally qualified retirement plan (other than an individual retirement plan) are generally considered income for the distribution year to the extent the distributions exceed contributions to the plan. However, when a plan allows the distribution to be paid directly to another federally qualified retirement plan maintained for the same owner’s benefit – as a direct trustee-totrustee transfer to the IRA – the distribution is not considered taxable income. Similarly, when the distribution is paid into the IRA no later than the 60th day after the day on which the IRA owner receives payment, the distribution is not considered taxable income. • The conversion of a traditional IRA to a Roth IRA is generally not taxable. That is, monies transferred from a traditional IRA to a Roth IRA via conversion (whether by a trustee-totrustee transfer or a roll-over within 60 days) are generally not subject to Pennsylvania personal income tax. However, any amounts transferred from the traditional IRA that are not put into the Roth IRA, be it by federal income tax withholding or otherwise, are subject to Pennsylvania personal income tax. In such a situation, basis is allocated pro-rata between the taxable distribution and the non-taxable conversion. If there is a partial rollover/conversion, the basis in the traditional IRA must be allocated prorata between the traditional IRA and the Roth IRA. Traditional IRA All workers under age 70 ½ at the end of the year. Roth IRA No age restrictions. Contributions Made with pre-tax income. Made with after-tax income. Tax Benefits of Contributions Fully deductible if no employer retirement plan exists. Not deductible. If converting from IRA to Roth IRA, conversion is generally taxable for federal income tax purposes. Tax Year: Under Age 50: 2014 2015 2016 2017 $5,500 $5,500 $5,500 $5,500 Same. If you have both an IRA and a Roth IRA, the total contributions cannot exceed limits shown at left. Tax Year: Over Age 50: 2014 2015 2016 2017 $6,500 $6,500 $6,500 $6,500 Eligibility Maximum Contribution (per individual) What are the PA rules with respect to IRA distributions to charities or for other nonretirement purposes? Charity distributions and other non-retirement distributions made before the IRA owner retires from service are considered income for PA personal income tax purposes, to the extent distributions exceed contributions to the plan. The cost-recovery method is used to determine the portion of distributions to be included in income. Same. If you have both an IRA and a Roth IRA, the total contributions cannot exceed limits shown at left. Rollovers Same. No annual limit on amount rolled over from another qualified plan. Conversion May convert from traditional IRA to Roth IRA, but the conversion is generally subject to federal income tax. Is there additional information available regarding PA personal income tax treatment of IRAs? Earnings/Withdrawals Yes. Please refer to Personal Income Tax Bulletin 2008-1 for additional IRA tax information, including details regarding employersponsored plans, investment accounts and inherited IRAs. The bulletin is available online at www.revenue.pa.gov Generally not subject to federal income tax until withdrawn. Qualified distributions after age 59 ½ are generally not subject to federal income tax. Possible penalty if not in account for at least five years. Distributions Before Age 59 ½ Generally taxable and subject to 10% early withdrawal penalty. Earnings generally taxable and subject to 10% early withdrawal penalty. For information regarding Pennsylvania personal income tax rules, see Q&A on reverse. www.revenue.pa.gov
Extracted from PDF file 2023-pennsylvania-form-rev-636.pdf, last modified March 2018

More about the Pennsylvania Form REV-636 Individual Income Tax TY 2023

We last updated the Retirement - Traditional IRAs and Roth IRAs Brochure in February 2024, so this is the latest version of Form REV-636, fully updated for tax year 2023. You can download or print current or past-year PDFs of Form REV-636 directly from TaxFormFinder. You can print other Pennsylvania tax forms here.

Other Pennsylvania Individual Income Tax Forms:

TaxFormFinder has an additional 174 Pennsylvania income tax forms that you may need, plus all federal income tax forms.

Form Code Form Name
Form PA-40 Pennsylvania Income Tax Return
Form 40 Instruction Booklet Income Tax Return Instruction Booklet (PA-40)
Form PA-40 SP PA Schedule SP - Special Tax Forgiveness
Form PA-40 A PA Schedule A - Interest Income
Form PA-40 PA-V PA-40 Payment Voucher

Download all PA tax forms View all 175 Pennsylvania Income Tax Forms


Form Sources:

Pennsylvania usually releases forms for the current tax year between January and April. We last updated Pennsylvania Form REV-636 from the Department of Revenue in February 2024.

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About the Individual Income Tax

The IRS and most states collect a personal income tax, which is paid throughout the year via tax withholding or estimated income tax payments.

Most taxpayers are required to file a yearly income tax return in April to both the Internal Revenue Service and their state's revenue department, which will result in either a tax refund of excess withheld income or a tax payment if the withholding does not cover the taxpayer's entire liability. Every taxpayer's situation is different - please consult a CPA or licensed tax preparer to ensure that you are filing the correct tax forms!

Historical Past-Year Versions of Pennsylvania Form REV-636

We have a total of three past-year versions of Form REV-636 in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:


2023 Form REV-636

Brochure: Retirement - Traditional IRAs and Roth IRAs (REV-636)

2022 Form REV-636

Brochure: Retirement - Traditional IRAs and Roth IRAs (REV-636)

2021 Form REV-636

Brochure: Retirement - Traditional IRAs and Roth IRAs (REV-636)


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