Hello,
I am retiring in Oct. 2023, I am having 3 pension pay me out as Lump Sums. I know they are taking 20% each for Federal; Do I have to also pay state taxes, I live in Washington, DC?
thanks
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Hello Tucker,
Congratulations on retirement.
Yes Washington DC will also tax you on the distribution. You can see if the pension company will withhold those taxes for you also
Congratulations on October retirement,
Retirement Income is generally considered taxable in DC. The District of Columbia (DC) does not tax Social Security Benefits or Railroad Tier I retirement benefits.
Kelly C, CPA
Hi Tuckergreen!
You've received very good responses from the forum today! Let me add to the chorus by saving that D.C ia a Federal Entity and has no separate state tax. It does have a progressive district income tax if they live in the District for at least 183 days in the year. Rates are a bit higher than the national average and can range from 4 to 10.75%.
Here mis a tax calculator that may prove to be very helpful for you:
https://smartasset.com/taxes/district-of-columbia-tax-calculator
Thank you for being a part of this forum!
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