Tax Withholdings from Pension Payments
At retirement, you should have already completed a form instructing MercedCERA how to withhold taxes from your monthly benefit payment. As a benefit recipient, you have several options regarding your withholding for Federal and State of California taxes. You may select an amount based on the tax tables and your tax filing status (i.e., single or married, and the number of allowances you designate). You may also designate a specific dollar amount. You may even elect to have nothing withheld.
If you are not a resident of California, state taxes should not be withheld. You can change your tax withholding at any time by completing and submitting the Tax Withholding Election form. These must be received by MercedCERA each month (generally before the 15th of the month) for a change to be processed in time for that month’s retirement payroll.