PolicyEngine · PavelMakarchuk · Jul 13, 2026
diff --git a/changelog.d/ct-pension-subtraction-cliff-9008.fixed.md b/changelog.d/ct-pension-subtraction-cliff-9008.fixed.md
@@ -0,0 +1 @@
+Fixed the Connecticut pension and annuity subtraction so the 2024 phase-out brackets no longer leak into 2019-2023, where the subtraction is zero above the AGI cliff.
diff --git a/...engine_us/parameters/gov/states/ct/tax/income/subtractions/pensions_or_annuity/joint.yaml b/...engine_us/parameters/gov/states/ct/tax/income/subtractions/pensions_or_annuity/joint.yaml
@@ -33,32 +33,40 @@ brackets:
   - threshold:
       2024-01-01: 105_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.7
   - threshold:
       2024-01-01: 110_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.55
   - threshold:
       2024-01-01: 115_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.4
   - threshold:
       2024-01-01: 120_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.25
   - threshold:
       2024-01-01: 125_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.1
   - threshold:
       2024-01-01: 130_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.05
   - threshold:
       2024-01-01: 140_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.025
   - threshold:
       2024-01-01: 150_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0
diff --git a/...ne_us/parameters/gov/states/ct/tax/income/subtractions/pensions_or_annuity/non_joint.yaml b/...ne_us/parameters/gov/states/ct/tax/income/subtractions/pensions_or_annuity/non_joint.yaml
@@ -33,32 +33,40 @@ brackets:
   - threshold:
       2024-01-01: 77_500
     amount:
+      2019-01-01: 0
       2024-01-01: 0.7
   - threshold:
       2024-01-01: 80_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.55
   - threshold:
       2024-01-01: 82_500
     amount:
+      2019-01-01: 0
       2024-01-01: 0.4
   - threshold:
       2024-01-01: 85_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.25
   - threshold:
       2024-01-01: 87_500
     amount:
+      2019-01-01: 0
       2024-01-01: 0.1
   - threshold:
       2024-01-01: 90_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.05
   - threshold:
       2024-01-01: 95_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0.025
   - threshold:
       2024-01-01: 100_000
     amount:
+      2019-01-01: 0
       2024-01-01: 0
diff --git a/policyengine_us/tests/policy/baseline/gov/states/ct/tax/income/integration.yaml b/policyengine_us/tests/policy/baseline/gov/states/ct/tax/income/integration.yaml
@@ -103,3 +103,32 @@
   output:
     income_tax: -733
     ct_income_tax: 2_415
+
+- name: CT 2021 joint filer with federal AGI above the 100k cliff gets no pension and annuity subtraction (taxsim 1077)
+  period: 2021
+  absolute_error_margin: 2
+  input:
+    people:
+      head:
+        age: 71
+        taxable_private_pension_income: 46_772.66
+        taxable_interest_income: 955.58
+        social_security_retirement: 10_204.63
+      spouse:
+        age: 69
+        taxable_private_pension_income: 46_772.66
+        taxable_interest_income: 955.58
+        social_security_retirement: 10_204.63
+    tax_units:
+      tax_unit:
+        members: [head, spouse]
+    households:
+      household:
+        members: [head, spouse]
+        state_code: CT
+  output:
+    adjusted_gross_income: 112_804
+    ct_pension_annuity_subtraction: 0
+    ct_social_security_benefit_adjustment: 12_246
+    ct_agi: 100_559
+    ct_income_tax: 4_671
diff --git a/...policy/baseline/gov/states/ct/tax/income/subtractions/ct_pension_annuity_subtraction.yaml b/...policy/baseline/gov/states/ct/tax/income/subtractions/ct_pension_annuity_subtraction.yaml
@@ -107,3 +107,36 @@
     taxable_pension_income: 10_000
   output:
     ct_pension_annuity_subtraction: 0
+
+- name: Joint household with $112,804 AGI in 2021 is above the cliff and gets no subtraction
+  period: 2021
+  input:
+    state_code: CT
+    is_tax_unit_head_or_spouse: true
+    filing_status: JOINT
+    adjusted_gross_income: 112_804
+    taxable_pension_income: 10_000
+  output:
+    ct_pension_annuity_subtraction: 0
+
+- name: Single household with $85,000 AGI in 2021 is above the cliff and gets no subtraction
+  period: 2021
+  input:
+    state_code: CT
+    is_tax_unit_head_or_spouse: true
+    filing_status: SINGLE
+    adjusted_gross_income: 85_000
+    taxable_pension_income: 10_000
+  output:
+    ct_pension_annuity_subtraction: 0
+
+- name: Joint household with $99,000 AGI in 2021 is below the cliff and gets the 42 percent subtraction
+  period: 2021
+  input:
+    state_code: CT
+    is_tax_unit_head_or_spouse: true
+    filing_status: JOINT
+    adjusted_gross_income: 99_000
+    taxable_pension_income: 10_000
+  output:
+    ct_pension_annuity_subtraction: 4_200
Original file line number	Diff line number	Diff line change
		@@ -0,0 +1 @@
		Fixed the Connecticut pension and annuity subtraction so the 2024 phase-out brackets no longer leak into 2019-2023, where the subtraction is zero above the AGI cliff.