Sch. J: Supplemental Annuities Schedule (2025)
Hawaii · Hawaii DoTax · Used for tax years 2025
Hawaii Schedule J computes the taxable portion of pension and annuity distributions, including applicable pension exclusions and recovery of employee contributions. It also calculates the pension adjustment to Hawaii adjusted gross income for Form N-11 filers and is attached to F
Who files this form
Use 2025 Schedule J to figure the taxable part of pension and annuity distributions. The form says you must use it if you received:
- Payments from a privately purchased annuity.
- Payments from a profit-sharing plan or pension plan to which you made employee contributions.
- A death benefit as the beneficiary of a deceased employee.
- A lump-sum distribution from a qualified retirement plan that you report on Form N-152 using the capital gain election or 10-year averaging method.
- Payments from a hybrid plan that combines pension and deferred compensation features, such as a 401(k) plan with employer matching.
Complete a separate Schedule J for each plan.
Exceptions apply. The form generally says not to use Schedule J for an annuity outside an employer pension plan if you made no employee contributions or recovered your cost before July 1, 1989, under the former three-year recovery rule. It also lists employer-paid pensions with no employee contributions among the exceptions, but provides special rules for lump-sum distributions reported on Form N-152.
Public retirement system distributions generally do not require Schedule J. However, use it to calculate taxable pension income if you made voluntary contributions under an elective right.
What you'll need
Have the following information ready:
- Your name as shown on Form N-11, N-15, or N-40, and your Social Security number or FEIN.
- Your first Schedule J, if you completed one in an earlier year. It contains figures you will reuse.
- The annual annuity amount, payments received this year, and any annuity dividends or other variable payments.
- Employee contributions, separated into previously taxed and pretax amounts, and employer contributions. Your employer or plan administrator should be able to provide contribution and cost information.
- The multiple used for federal purposes to determine the contract’s expected return.
- For Form N-11 filers, the federally taxable amount of the annuity.
If applicable, you will also need Form N-152 information for a lump-sum distribution. Federal Form 1099-R provides the net unrealized appreciation amount if you elect to include that amount in income.
How to file
Attach Schedule J to Form N-11, N-15, or N-40. The supplied text does not give a mailing address or e-filing directions.
- Complete Part I only for the first year you receive the annuity. Keep a copy for future years.
- Complete Part II for each year you receive annuity payments.
- If filing Form N-15, enter Schedule J line 22 on line 16, Column A. If filing Form N-40, enter it on line 8.
- If filing Form N-11, complete Part III and enter the adjustment from Schedule J line 24 on Form N-11, line 13.
If you use Schedule J to calculate a lump-sum distribution reported on Form N-152, enter Schedule J line 20 on Form N-152, Part III, line 14. You do not need to complete the rest of Schedule J.
Common mistakes
- Not keeping the first-year calculations. Keep Part I because you will need its figures in later years.
- Using only a partial year’s payments on line 1. Enter the fixed annual amount you would receive over 12 months. Put variable or indefinite amounts on line 15 instead.
- Taking the same exclusion twice. Employer contributions already deducted under another provision cannot be deducted again. If an annual death benefit exclusion applies, the line 10 instructions require an adjustment to avoid a double exclusion.
- Missing first- and last-year adjustments. If the annuity starts after the first day of the year, prorate the exclusions on lines 13 and 19 using the number of months payments are received.
- Continuing to recover costs after they are fully recovered. For an annuity starting after 1986, do not claim further recovery of the employee’s investment on line 19 once that investment has been fully recovered.
Questions people ask
Do I need a separate Schedule J for each plan?
Yes. Complete a separate Schedule J for each plan from which you receive benefits.
Do I complete Part I every year?
No. Complete Part I only in the first year you receive a distribution. Keep it so you can use its figures in later years.
Does the pension exclusion cover my employee contributions?
No. The pension exclusion applies only to amounts attributable to employer contributions. Schedule J separately calculates the annual recovery of your previously taxed investment in the annuity contract.
Can payments qualify as a pension while I am still working?
Yes. Required distributions received by pension plan participants who have reached age 73 and are still employed by their employers also qualify as pensions.