Helpful miscellaneous articles
regarding our retirement plan and planning.
Like you, I review my retirement nestegg and plan from time to
time. Recently, I went though some continued
education for some credentials I maintain and it occurred to me that we all
could use a review about these issues.
So with your help, we will share and post articles and info that may be
helpful and of interest to many of you in this section.
Tax
information RE the PBGC from Capt Bob Pike:
I'm sending this to both of you with
the hope that you will pass it on to your email list of retired Delta
pilots. My brother (Retired USAir pilot) told me that the withholding on
his monthly distribution form the PBGC had changed drastically over the past
few months and advised me to check mine. My January payment was the same
net amount it had been for years but in February my withholding DECREASED by
over $1000.
I called the PBGC and spoke to a very helpful woman who explained that the IRS,
without notification or explanation, had required them to change withholding to
some arbitrary base category - in my case, single with no dependents. Since I have income from other sources (IRA's, SS, Investment Accounts) as I'm certain most retirees do, I had long ago adjusted my PBGC withholding to
reflect my personal requirements - which the IRS has totally ignored. She told me the PBGC was also blindsided by this requirement but had to follow
the IRS directive even though none of us received a heads up or any other
notification. She did say that the PBGC would be sending out some sort
of explanation at some indefinite time.
My next step, under her direction, was first to enter the convoluted PBGC
website to find the record of recent Gross and Net distributions and then do
the math to find what my monthly withholding had been. Â I then used their
link to find IRS Form W-4P, compute the difference between what they had taken
out in February and what I actually wanted taken out (that's the $1000+ I mentioned)
and enter that number in the bottom line of the form to bring my withholding
back up to the same number it has been for years. You might think that
in the computer age the change would take effect in the next pay period - the
US Government will take 45 days minimum to make it happen.
I would recommend that all Retirees who are receiving a PBGC benefit take a
look at your recent payments to see if your withholding has changed - if so you
may want to submit a W-4P ASAP.
Bob Pike
(As with any of these informative articles,
anyone who needs someone to talk to about
this
very subject contact me and I can direct you to a knowledgeable advisor).
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