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Frequently Asked Questions Retirement

What kind of withholdings can voluntarily be taken from my benefit?

You can voluntarily withhold Federal and State income taxes, checking and savings allotments, or allotments to other participating organizations.

Federal Income Tax: Generally, unless you specify a monthly withholding rate or amount, we withhold Federal income tax as if you are married and claiming three allowances. Use Services Online to start, change, or stop the Federal tax withheld from your annuity payment or specify the dollar amount withheld.

You can also call us or write us to change your withholding amount. If you write, your letter should include your claim number and the monthly amount in dollars you want withheld. If you write, we will send you a Form W-4P-A, "Election of Federal Income Tax Withholding," and instructions for making the change. The change in your withholdings will be made after we receive your Form W-4P-A.

You may change the amount withheld whenever you think it is necessary.

Please note that you may be penalized by the Internal Revenue Service (IRS) if you do not have at least 90 percent of your yearly tax liability either withheld from your salary or annuity or made via quarterly payments to the IRS.

If you need more information or assistance in determining whether or not you are having the right amount of Federal income tax withheld, see the Internal Revenue Service website at http://www.irs.gov.

State Income Tax: You must specify the dollar amount of State tax you want withheld from your monthly payments. The withholding must be in whole dollars. The minimum amount we can withhold for State income tax is $5. Use Services Online to start, change, or stop the State tax withheld from your annuity payment.

You can also call us or write us to change your withholding amount. If you write, your letter should include your claim number and the monthly amount in dollars you want withheld.

If you do not know the monthly amount you want withheld, contact your State tax office for information or assistance.

Check our list of State tax offices for information about participating States.

If your State does not participate, please contact the State tax office for information or assistance.

Savings Bonds:

As of April 1, 2009, The Office of Personnel Management is no longer withholding for the purchase of savings bonds. Please contact your bank or other financial institution or the Department of the Treasury to purchase these bonds. For further information on Savings Bonds visit the Treasury Direct website or call 1 (800) 4US-BOND.

Allotments to Organizations: You can start, change, or stop an allotment to participating organizations. Participating organizations include:

  • American Federation of Government Employees (AFGE);
  • Fraternal Order of Retired Border Patrol Officers (Museum);
  • National Association of Postmasters of the U.S. Political Action Committee;
  • National Rural Letter Carriers Association Political Action Committee;
  • National Treasury Employees Union (NTEU);
  • Northwest Plan Administrators; and
  • Treasury Employees Political Action Committee.

If the organization for which you wish to make an allotment is not listed above, you should contact them and ask them to provide us with the banking information needed to forward payments. The organization can contact us by email at finance@opm.gov.

Use Services Online or call our toll-free number to make one-time or recurring membership payments to organizations.

Checking and Savings Allotments:  Checking and savings allotments are voluntary deductions for allotments sent by direct deposit to a checking or savings account in your name. You may have up to two allotments. The accounts must be maintained at a domestic financial institution. This does not include charities, savings bonds, garnishments or other court orders, union or other organizational dues. You must maintain at least $100 net annuity payment. The allotment must be for a minimum of $50.

Use Services Online to start, change, or stop an allotment or call our toll-free number to establish a checking or savings allotment.

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