Earned income is subject to the Trenton local income tax but unearned income is not. Common illustrations of earned income include the following paid by the employer(s) before any deductions:
- Other Compensation
Unlike for your Federal return, you may not deduct contributions to a retirement plan (IRA, 401k, 403b, or 457b) on your Trenton return. Gross earnings are taxed in the year earned. Most pension and retirement income are not taxable when you are retired and receiving distributions.