Note: On this page, SamCERA is providing
certain tax-related information to you but is not providing tax
advice. For questions regarding tax or legal matters, consult
with a professional advisor; SamCERA does not offer tax or legal
advice. Additional information can be found in the Guide to Your
SamCERA Benefits.
Tax Withholdings
When you retire, you must submit completed tax
withholding forms to SamCERA. If you need assistance
determining which withholding election is best for you, consult
with a professional tax advisor or contact the Internal Revenue
Service (IRS) or the California Franchise Tax Board (FTB) for
information. SamCERA does not provide tax advice.
SamCERA is required by law to withhold state and federal taxes at
the applicable default rates as set forth under California and/or
federal statutes, rules, and regulations.
If you reside outside of California or move out of
state: SamCERA will not deduct state income tax from
your benefit, for California or any other state. If you have an
existing withholding and move out of state, any existing
California withholding will stop being deducted when we receive a
change of address form. We will still deduct federal income tax.
If you reside outside of the U.S. or move outside the
U.S.: Please see IRS Form W-4P and EDD Form DE-4P for
information and instructions.
Changing Your Withholding Elections: You can
change your tax withholding election at any time by completing
new Tax Withholding forms, which are available
online: Member Forms or on the MySamCERA member
portal: MySamCERA.
Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA)
Annual Notice: The Tax Equity and Fiscal
Responsibility Act of 1982 (TEFRA) requires that SamCERA notify
retired members each year that they may change their tax
withholding election. The current TEFRA notice can be found
below.
1099-R Annual Tax Reporting Statement
Each January, retirees will receive an IRS 1099-R Form that
contains information about reportable income and taxable income
from SamCERA for the previous calendar year. It will also
reflect the amount of federal and California taxes that have been
withheld.
Retirees can view and print copies of their 1099-R online at
MySamCERA.
Disability Retirement Benefits
If the Service-Connected Disability (SCD) benefit is equal to 50%
of the member’s final average compensation, SamCERA will treat
the entire SCD benefit as tax-exempt and it cannot be subject to
any withholding. If the SCD is greater than 50% of the
member’s final compensation, the portion of the benefit over 50%
is taxable and the member’s withholding election will be based on
that portion only. For more information please refer
to: IRS
Private Letter Ruling Regarding Taxes and Disability.
Non-service-connected disability benefits are taxable.
