Updated September 4, 2026. Quick answer: Yes, in almost all cases. California conforms to federal treatment, so public, private and federal pensions and IRA/401(k) distributions are all fully taxable, the same as ordinary income. The one new exception: starting tax year 2025, up to $20,000 of military retirement pay is exempt for filers under an income cap, through 2029.
Confidence note: high. This page is scoped to pension, IRA and 401(k) taxation specifically. For the state’s full retirement-tax picture (Social Security, tax rates, estate and probate), see how California taxes retirement income generally.
How pensions and retirement-account withdrawals are taxed
| Public (state/local government) pensions | Fully taxable. California conforms to the federal treatment of pensions with no state-specific exemption. |
|---|---|
| Private (employer) pensions | Fully taxable, identical treatment to public pensions. |
| Federal government pensions (FERS/CSRS) | Fully taxable, following the same federal-conformity rule; not listed among the state’s specific differences from federal treatment. |
| Military retirement pay | New for tax year 2025: up to $20,000 of uniformed-services retirement pay or DoD Survivor Benefit Plan annuities is exempt, subject to an AGI cap of $125,000 (single) or $250,000 (joint), effective through 2029. Before this, military retirement pay was fully taxable like any other pension. |
| IRA and 401(k)/403(b) distributions | Fully taxable, following federal rules, with California-specific basis adjustments carried over from old nondeductible contributions. |
| General retirement-income exclusion | A nonrefundable Senior Exemption Credit of $153 per qualifying spouse or registered domestic partner age 65+ for 2025 (inflation-adjusted from a $52 statutory base) offsets tax generally, not specifically retirement income. |
Coordinate this with your overall retirement plan
An adviser can help weigh how much of a pension or IRA withdrawal to take this year, whether a Roth conversion makes sense before or after a move, and how state tax interacts with the rest of your plan, but that does not replace the numbers in your own return.
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Social Security
Social Security is never taxed by California. Social Security has its own rules in every state; see the full breakdown in how California taxes retirement income generally.
Statute and sources
Governing citation: Cal. Rev. & Tax. Code sec. 17081 (general conformity), sec. 17054 (senior credit), secs. 17132.9 to 17132.10 (2025 military exclusion).
- California FTB Publication 1005 (2025)
- Cal. Rev. & Tax. Code sec. 17132.9
- California FTB 2025 Form 540 Booklet
Read September 4, 2026.
Related: how California taxes retirement income generally · does California tax Roth conversions? · Roth conversion taxes, all 51 jurisdictions.
General information drawn from each state’s own published statutes and revenue-department guidance, not legal, tax or financial advice. Figures and exemption amounts are current as of the date in the quick answer, are set by state law, and can change by future legislation; any pending bill named on this page is not yet law. This page cannot see your own return, which governs. We are not a law firm, a tax adviser, or a fiduciary, and this is not personalized advice.