Updated October 16, 2026. Quick answer: Utah taxes 403(b) and 457(b) withdrawals like other income: the TC-40 instructions and the statute print no general retirement-plan exclusion, only a retirement credit of up to $450 for people born on or before December 31, 1952, reduced by 2.5 percent of modified adjusted gross income above a filing-status threshold, and neither document names 403(b) or 457(b) plans.
State retirement-income forms, line by line: Utah retirement credit.
Utah at a glance
| Item | What the documents say |
|---|---|
| How the state treats 403(b) and 457(b) withdrawals | Taxed like other income; the documents read do not name these plans |
| Do the state’s documents name these plans? | The documents read name neither 403(b) nor 457(b) plans |
| Retirement exclusion or credit | A nonrefundable retirement credit of up to $450 for people born on or before December 31, 1952, reduced by 2.5 percent of modified adjusted gross income above a filing-status threshold; not an exclusion |
| Public-employee pension rule | No public-employee pension exclusion is described |
| Rate in the documents read | 4.5% for 2025; the statute prints 4.45% effective January 1, 2026 |
| Changed for 2026? | Utah Code 59-10-104 as effective January 1, 2026 prints 4.45%, down from 4.5% |
What the Utah documents say
The TC-40 instructions say a filer “you may take a retirement credit of up to $450”, and a filer cannot claim it together with the Social Security benefits credit or the military retirement credit. The instructions compute the tax with “Multiply line 9 by 4.5 percent (.045)”.
The statute that takes effect January 1, 2026 sets the rate: “(b) 4.45%”.
Withholding and federal tax
Whether a state withholds is a separate rule: see state withholding on retirement withdrawals. Federal rules: 403(b) withdrawal rules and 457(b) withdrawal rules. The IRS says pension and annuity payments from a qualified employer plan have “all or some portion of the amounts you receive may be taxable”.
What the documents do not say
- The documents read do not name 403(b) or 457(b) plans.
- A separate military retirement credit covers military retirement pay only.
- The 2026 rate comes from the statute, not from a 2026 form.
Common mistakes
- Assuming Utah’s rule for a 401(k) or IRA also covers a 403(b) or 457(b): read whether its documents name the plan.
Related: whether Utah taxes 401(k) and IRA withdrawals, Utah retirement taxes, whether Utah taxes pensions, 403(b) withdrawal rules, 457(b) withdrawal rules, and state withholding on retirement withdrawals.
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Answer againSources
- 2025 Utah TC-40 Instructions (individual income tax): https://files.tax.utah.gov/tax/forms/current/tc-40inst.pdf
- Utah Code 59-10-104 Tax basis: Tax rate: Exemption: https://le.utah.gov/xcode/Title59/Chapter10/C59-10-S104_2026050620260506.html
- Tax Rates (2025 Utah Income Tax): https://incometax.utah.gov/file-pay/tax-rates/
- IRS Tax Topic 410, Pensions and annuities: https://www.irs.gov/taxtopics/tc410
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.