Q. I am a retired CSRS employee. What taxes, if any, do I owe New York state on annual distributions? The initial contributions were not taxed by New York.
A. Your distributions are considered ordinary income for tax purposes. They should be reported as such on your federal and state tax returns, unless your state provides a special exemption for this type of income. If you want specific guidance for completing your tax return, you should seek the help of a qualified tax preparer.