Pension Tax Question

Pension Tax Question

Pension Tax Question

I recently retired. I receive a small monthly pension. My total pension is a little more than $6000 a year. I have no other pension.

I have a new job with reportable income. I am single and claim only myself. I just received my first pension check, and the IRS did not withhold any tax.

I authorized the IRS to withhold on the W-4P form. I have gone over the W-4P form again and I am confused. Is this small pension tax free or should I resubmit and request that a certain amount should be withdrawn each month? Thanks Keith

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Jan 20, 2024
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by: BB

Your pension income is generally subject to federal income tax, but the amount of tax you owe depends on various factors, including your total income and deductions. Given that the IRS did not withhold tax from your first pension check, it might be beneficial to review and potentially update your withholding to avoid any surprises during tax filing.

Here are some steps you can consider:

Review Your Tax Situation:

Calculate your total expected income for the year, including your new job income and the pension.
Consider any eligible deductions and credits.
W-4P Form Adjustment:

If you find that you may owe taxes at the end of the year, you can consider adjusting your W-4P form to have a specific amount withheld from each pension payment.
Complete a new W-4P form with the updated withholding information.
Consult a Tax Professional:

If you're unsure about how to proceed, it's advisable to consult with a tax professional or accountant. They can help you assess your specific situation and provide personalized advice.

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Pension Payable To Ex

I share part of my pension with ex wife can I claim this amount and were would I put it on tax form?

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Pension Payouts and Divorce

by Candi
(NC)

My husband and I divorced in January 2002. As part of our divorce decree, I was awarded 50% of his monthly pension when he reached the age of 45. Also as part of the divorce decree, I was the sole beneficiary of his pension funds should he die. I was married to him from the first day he was part of the pension plan to the time he took early retirement in 1999.

In July 2006 he passed away. All funds came to me in a lump sum but I was taxed higher because we weren't married at the time of his death. The government took over $50,000 of these funds. Is this accurate? We were married for 20 years and only divorced for 5 1/2 years.

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