Question for you Federal retirees

cheerful1_gwJanuary 26, 2009

Did you elect up front to have Federal tax withheld from your pension? If so, did it end up being enough when you go to file your tax return?

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I chose to have Federal income tax withheld from my pension, plus an extra $100.00 per month to cover the expected tax on certain investment income.

The amount withheld has been enough to cover the taxes owed. In fact, I could stop the extra withholding of $100 and still have enough.

    Bookmark   January 26, 2009 at 5:21PM
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IRS Publication 15 (Circular E) will show you how much will be withheld from your pay, based on pay amount and periodicity, as well as marital status and number of exemptions claimed. You can vary your number of exemptions somewhat, or have an additional amount withheld, in order to come closer to your actual tax obligation.
Retirees may need to consider the tax impact of IRA withdrawals and other income, as well as changes in deductions.
This holds for all retirees, not just federal.

Here is a link that might be useful: IRS Forms and Publications

    Bookmark   January 26, 2009 at 10:57PM
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We're both still working and trying to figure out things.

I did a draft 2008 tax return, assuming I wasn't working anymore, and reporting just my husband's federal pension and 20% withholding.

I was amazed at how large the refund would be. I'll have to check Circular E to see how much we actually need to withhold.

    Bookmark   January 27, 2009 at 4:54AM
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I've only been retired for four months, so I won't really know until we file our 2009 taxes if the withholding needs any adjustment. I'd rather owe or come close to breaking even than receive a refund. I have state withholding too.

    Bookmark   February 1, 2009 at 1:24PM
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