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Old 11-17-2017, 10:10 AM
 
98 posts, read 100,803 times
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Is there anyone on the forum who has the Ohio Public Employees Retirement System (OPERS)? Is it possible to estimate how much of your monthly retirement benefit will be taken out as taxes?
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Old 11-17-2017, 03:26 PM
 
Location: OH>IL>CO>CT
5,229 posts, read 8,388,588 times
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Not in that plan, but if no one responds who is, here is how it works:

You will complete an IRS Form W-4P https://www.irs.gov/forms-pubs/about-form-w4p

Ohio will then use that info and your benefit amount etc, and do a lookup on IRS Pub 15

https://www.irs.gov/forms-pubs/about-publication-15 to determine the amount of Federal withholding.

You can read more "gory" details here https://www.irs.gov/individuals/inte...ty-withholding but be careful as it is written from the perspective of the pension plan administrator.
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Old 11-19-2017, 10:35 AM
 
98 posts, read 100,803 times
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My husband is currently researching the OPERS retirement options, and there are different options depending on whether a beneficiary receives 100%, 50%, or 0% of his pension check every month after his death. We are having trouble figuring out which formula to choose because we don't know how much of the monthly check would be taken out as taxes. He called OPERS, and they said that it was always individual, depending on family situation, dependents, etc. But is there at least a way to approximate how many hundreds of dollars we should subtract from his monthly check as taxes? Without knowing how much money would be paid as taxes, it's difficult to figure out which of the different options would leave us with enough money to live on per month...
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Old 11-19-2017, 01:02 PM
 
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The other option is to hire a local Ohio licensed CPA for a couple of hours to do all of the necessary calculations. It will cost you a few hundred dollars but you will get a personalized answer from someone used to retirement issues.
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Old 11-19-2017, 01:43 PM
 
Location: OH>IL>CO>CT
5,229 posts, read 8,388,588 times
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Quote:
Originally Posted by Lilac11 View Post
My husband is currently researching the OPERS retirement options, and there are different options depending on whether a beneficiary receives 100%, 50%, or 0% of his pension check every month after his death. We are having trouble figuring out which formula to choose because we don't know how much of the monthly check would be taken out as taxes. He called OPERS, and they said that it was always individual, depending on family situation, dependents, etc. But is there at least a way to approximate how many hundreds of dollars we should subtract from his monthly check as taxes? Without knowing how much money would be paid as taxes, it's difficult to figure out which of the different options would leave us with enough money to live on per month...
You could try this.
Using the online app TaxCaster at https://turbotax.intuit.com/tax-tool...ors/taxcaster/, you could enter the info as if you are receiving the pension income (and any other income ; ie, Social Security, bank interest, etc), leave current withholding blank, and it will approximate what needs to be withheld to cover the total income. (then divide that by 12 to get the monthly)

And yes, as OPERS said, the actual amount depends on how you fill out IRS Form W-4P, similar to when he was first hired, and did a W-4.
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Old 11-19-2017, 01:49 PM
 
Location: Wooster, Ohio
1,036 posts, read 785,471 times
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If your income and pension are as good as your husband's, you can accept 0% as a beneficiary. If your income and pension are half as good as your husband's, you can accept 50%. If your income and pension are less than half of your husband's, then you need 100% income as a beneficiary. Otherwise, you risk poverty when you probably outlive your husband.

As far as taxes, you need to figure that out yourself. Figure out your yearly retirement income, then go to the state and federal tax tables to see how much must be withheld from the retirement check. You may also owe municipal and school district taxes. Don't forget health insurance. Ohio PERS no longer pays for the spouses health insurance, so at the minimum, you need 40 quarters of Medicare credits before you are 65, and your own health insurance until then.

If you accept the minimum Ohio PERS tax withholdings, you may end up with substantial tax payments when you file your income taxes. I am also withdrawing money from my 457(b) deferred compensation plan, and reinvesting the money. 30% is being withheld for federal, and 5% for state, in order to cover interest income and my part-time job. Even declaring 0 exemptions, I do not think the withholdings from that job approach my marginal tax rate.
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Old 11-20-2017, 08:56 AM
 
98 posts, read 100,803 times
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Thank you all for the advice!
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Old 11-20-2017, 10:13 AM
 
Location: Grove City, Ohio
10,129 posts, read 12,376,133 times
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Quote:
Originally Posted by Lilac11 View Post
Is there anyone on the forum who has the Ohio Public Employees Retirement System (OPERS)? Is it possible to estimate how much of your monthly retirement benefit will be taken out as taxes?
My wife has a small OPERS retirement from the time she worked in a public library.

We do not have any taxes taken out but I have an extra $100 weekly coming out of my employment pay which makes up for the tax on her OPERS and Social Security check.

Once we both retire from everything I have read we won't have any federal or state taxes so nothing coming out.

Something great about the OPERS system we just discovered is the medical reimbursement that appears to be off the income. She pays $120 for her Medicare Plan G every month and OPERS reimburses her for that and the Plan D every month so she doesn't have any of those costs that we mare mortals have. Also they reimburse for out of pocket dental and eye glasses but we have to show proof the money was paid for by us so this month and next we be running up our medical bills (two crowns and new eye glasses) so we can get the money back.
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Old 11-20-2017, 10:20 AM
 
16 posts, read 11,947 times
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Another nice thing about OPERS is that your benefits FAR exceed what you paid in. Once again the taxpayer is stuck with with paying for the lavish pensions and benefits received by the public employees.
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Old 11-20-2017, 10:30 AM
 
Location: Grove City, Ohio
10,129 posts, read 12,376,133 times
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Quote:
Originally Posted by arnolitto View Post
Another nice thing about OPERS is that your benefits FAR exceed what you paid in. Once again the taxpayer is stuck with with paying for the lavish pensions and benefits received by the public employees.
You be talking about the $400/month my wife receives?

She gets the $400 but her social security benefit is WEP'd 2 for 1.

But I ain't complaining.. if anything it was super great to have it at age 60 just for the medical benefits for us as a couple. Super.
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