Updated October 16, 2026. Quick answer: Only if you ask. New York State tax is withheld from an annuity or pension payment only if the payee volunteers by submitting Form IT-2104-P; the form says “you must request an amount that is at least $5 per month”.
New York pension withholding at a glance
| Item | What the documents say |
|---|---|
| Is state withholding required on regular pension payments? | No. New York withholds only if you submit Form IT-2104-P |
| Default rate if you give the payer no form | No default. You enter a whole-dollar amount per payment, at least $5 per month |
| Lump sum or one-time payment | The documents read give no separate lump-sum rule; the form applies to a pension or annuity payable over more than one year |
| Form to start, change or stop it | Form IT-2104-P (12/24), given to the payer |
| Changed for 2026? | No change stated |
What the New York documents say
New York’s Department of Taxation and Finance says you may use Form IT-2104-P to voluntarily have New York State income tax withheld from an annuity or pension. Without the form nothing is withheld for the state.
On the form you request withholding of a whole-dollar amount per payment, and the annuity or pension must be payable over a period longer than one year. The request stays in effect until you ask the payer in writing to terminate it. The authority the form cites is Tax Law 671(b).
What a mover should know
This page is about New York as a state of residence. An instruction line written for a nonresident or part-year filer is not the rule for a resident, and none of the documents read settles a part-year or two-state case, so check each state’s own rule. The federal side is the same everywhere; CMG’s federal 20% withholding on a pension lump sum page covers it, state tax withholding on IRA and 401(k) withdrawals in New York covers the account side, and state withholding on retirement withdrawals lists the other states checked.
What the documents do not say
- The documents read give no default rate and no lump-sum rule, and describe no change for 2026.
Common mistakes
- Assuming the payer is withholding for the state because it withholds for the IRS: in a voluntary state nothing is withheld until you give the payer the state’s form.
- Assuming the answer for one state applies to another, or that state withholding settles the state tax owed at filing.
Related: state tax withholding on IRA and 401(k) withdrawals in New York, New York retirement taxes, whether New York taxes pensions, state withholding on retirement withdrawals, and retirement withholding calculator.
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Answer againSources
- Form IT-2104-P, Annuitant’s Request for Income Tax Withholding (12/24): https://tax.ny.gov/pdf/current_forms/it/it2104p_fill_in.pdf
- IRS Tax Topic 413, Rollovers from retirement plans: https://www.irs.gov/taxtopics/tc413
Sources: the primary documents linked above, read on October 16, 2026. General information, not tax advice. Your own facts decide the outcome, and a tax professional or the state agency itself is the right place to confirm anything consequential.