Taxes and Your NYSLRS Retirement Benefit

Your NYSLRS retirement benefit isn’t subject to New York State or local taxes, but it is subject to federal income tax. Before you retire, take some time to think about how taxes could affect your retirement planning.

Will Your Pension Get Taxed in Another State?

While New York State won’t tax your NYSLRS retirement benefit, other states might. If you’re thinking of moving after retirement, you’ll need to consider the tax laws of the state you move to. The Retired Public Employees Association keeps a list of which states tax pension income on their website. And remember, if you do move, we’ll need your updated mailing address for our records.

Federal Tax Withholding Status for Your Pension

taxesAfter you’ve filed for retirement, we’ll reply back to you with a confirmation letter and some forms. One of these forms will be a W-4P form (Withholding Certificate for Pension or Annuity Payments). You’ll need to fill out this form to choose the amount you want withheld from your benefit each month for federal taxes. You can choose the withholding tax status that suits you, and you can change it any time afterward by completing a new W-4P form.

If you’re not sure how much you’ll need withheld for federal taxes, consider meeting with a tax professional to assist you before submitting the form. We also offer a federal tax withholding calculator on our website to help you plan.

Getting Your 1099-R

Once you start receiving your pension benefit, we’ll send you a 1099-R form for federal income tax filing purposes. A 1099-R form lists the distributions you’ll receive from your NYSLRS pension. We mail 1099-Rs out each year by January 31, so make sure we have your correct mailing address on file. This is especially important if you plan on moving in retirement.

We also feature an interactive 1099-R tutorial on our website. It can be a helpful tool to look at the first time you receive your 1099-R.

For more about taxes and your pension, please read our Tax Information About Your Pension FAQs.

21 thoughts on “Taxes and Your NYSLRS Retirement Benefit

  1. Denise

    Question – If my effective date for retirement is July 15, 2016 – can you give me an estimate date of when I’ll receive my first Pension Check?

    Reply
    1. NYSLRS Post author

      If you’re eligible to receive partial payments and you retire any time in July, your first partial payment would be mailed out on the first business day of September. Partial payments are approximately 90 to 95 percent of the estimated monthly amount associated with the retirement option you elected, and are based on your most recent estimate or benefit projection.

      Reply
  2. Teresa Ackroyd

    I will have less than 20 years service. I see if I retire before age 62 I will penalized 6 per cent. IF I work until 61 and 6 months of age will the penalty be decreased.

    Reply
    1. NYSLRS Post author

      Yes. The percentage of the benefit reduction is prorated based on your exact age at retirement.

      Unfortunately, the NYSLRS Social Media team doesn’t have access to your retirement account information. However, if you are looking for information specific to your tier and retirement plan, we recommend you email our customer service representatives using our secure email form, and one of our representatives can review your account to address your questions. Filling out the secure form allows us to safely contact you about your personal account information. Please allow five to seven business days for a response.

      Reply
  3. Jeannine M. Locke

    In the latest “Retiree Notes” page 3, Taxes and your Pension, I was not aware that my pension benefit was not subject to “Local” taxes. Where can I obtain written information on this.

    Reply
    1. Dave

      Just to clarify, what they are talking about are local INCOME taxes. Like the ones New York City and Yonkers have. They are not talking about local property, school, or sales taxes, which are not taxes on your salary. You still have to pay them.

      Reply
  4. Sydney

    Today is the 16th of February and I still do not have my 1099-R needed for the Enhanced Star Program. Please can you tell me when I can expect this?

    Reply
    1. NYSLRS

      1099-R forms are sent out by January 31 each year. You can request a reprint by using our web form (link below), and the reprint will be sent to the address we have on file for you.

      If you did not receive your 1099-R, it could be that you need to update your address with NYSLRS. If your new address is not a PO Box, you can call 1-866-805-0990 to update your address and request a 1099-R by phone.

      You could also email (http://www.emailNYSLRS.com) or fax your request to 518-473-8190. In your request, please include your retirement registration number or last four digits of your Social Security number, your old and new address, your phone number(s), your signature (for a fax) and what year 1099-R you need reprinted. If you contact us by email, please allow 5 – 7 business days for a response.

      http://www.osc.state.ny.us/retire/retirees/reprint_of_1099r_forms.php

      Reply
  5. J Chan

    I live and work in NYC and I believe they take the taxes on the pension now because when I file my annual taxes, NY State puts back the amount as income while the federal takes it out. Is this correct? So we really do pay local taxes on it.

    Reply
    1. NYSLRS

      While you’re working, your member contributions are subject to state and local taxes. When you retire, your pension is not taxed in New York State (though it is subject to federal income tax).

      If you move out of New York, you may have to pay state taxes on your pension. You can visit the Retired Public Employees Association website to see which states tax pensions.

      Reply
  6. Jeffrey A Stonehill

    When will the 2% retroactive raise from the interim one-year contract that covered the gap period from 4/1/15 to 3/31/16 adjust to increase the current pension payments I receive? I retired 1/28/16 so most of that contract’s raise (which I received in a lump sum) should apply to increase my salary for my last year on which the amount of pension is calculated.

    Reply
    1. NYSLRS

      We actually covered retroactive payments in a recent blog post. As long as that time period is part of your final average salary, your pension will go up.

      For account-specific details (such as how long your pension recalculation might take), please email our customer service representatives using our secure email form. One of our representatives will review your account to address your questions. Filling out the secure form allows us to safely contact you about your personal account information. Please allow five to seven business days for a response.

      Reply
    1. NYSLRS

      While you can’t download a copy of your 1099-R, you can request a reprint by using our web form. We’ll send the reprint to the address we have on file for you.

      1099-R forms go out by January 31 each year. If you did not receive yours, it could be that you need to update your address with NYSLRS. If your new address is not a PO Box, you can call 1-866-805-0990 to update your address and request a 1099-R by phone.

      You could also email (http://www.emailNYSLRS.com) or fax your request to 518-473-8190. In your request, please include your retirement registration number or last four digits of your Social Security number, your old and new address, your phone number(s), your signature (for a fax) and what year 1099-R you need reprinted. If you contact us by email, please allow 5 – 7 business days for a response.

      Reply
  7. Deb

    W-2 shows box 13 Retirement Plan with an X in it. I never recall joining the NYS Retirement plan. Does that mean I must have joined?

    Reply
    1. NYSLRS Post author

      If you have ever worked for a public employer in the State of New York, it’s possible that you have a NYSLRS membership. Unfortunately, the NYSLRS Social Media Team does not have access to members’ account information, so we cannot look up your information. You can email our customer service representatives using our secure email form (http://www.emailNYSLRS.com) and one of our representatives can review your account and get back to you. Filling out the secure form allows them to safely contact you about your personal information. Please allow five to seven business days for a response.

      You will be asked for your member registration number, but you don’t need your registration number in order to ask a question by secure email. Instead, please fill out the other fields so we can identify you, and enter a placeholder number (12345678, for example) in the Registration Number field.

      Reply
    1. NYSLRS Post author

      To get the account-specific information you need, please email our customer service representatives using our secure email form, and one of our representatives will review your account to address your questions. Filling out the secure form allows us to safely contact you about your personal account information. Please allow five to seven business days for a response.

      Reply

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