Effective December 1, 2022, Wisconsin Retirement System annuitants will need to use two separate forms for their federal and Wisconsin tax withholdings. Why? The Internal Revenue Service has changed how it allows public pension systems – therefore, the Wisconsin Retirement System — to receive federal tax withholding elections from their members. In addition, recent changes have been made to the Wisconsin tax formula.
You do not need to take any action at this time. The Department of Employee Trust Funds has automatically converted WRS annuitants’ federal tax withholding to comply with the new format. As a result, you may see a change reflected in the amounts of federal and state taxes withheld on your annuity payments in December 2022.
On your Annuity Payment Statement, you may now see new categories under the Federal Income Tax Withholding column such as Income Job/Annuity, Dependent/Other Credits, Other Income, or Deductions. Amounts listed in these categories are based on an IRS formula ETF used to convert your federal tax withholding election. For example:
- If your marital status was single, you will see $8,600 in the Other Income field.
- If your marital status was married, you will see $12,900 in the Other Income field.
- Amounts shown in the Deductions field are a conversion for your previous number of allowances. (The standard formula applied was the number of previous allowances/exemptions, multiplied by $4,300).
- Amounts shown in the Extra Withholding/Month field is the same as your most recent tax withholding election for Extra Withholding.
Change Your Tax Withholding
In the future, if you want to change your tax withholdings from your WRS annuity:
- Federal Tax Withholding – Complete the new IRS Form W-4P: Withholding Certificate for Periodic Pension or Annuity Payments.
- Wisconsin Tax Withholding – Complete the new Wisconsin Tax Withholding Election for WRS Annuity Payments (ET-4337).
Both forms should be submitted to ETF. Don't forget to sign and date the forms and make copies for your records.
- Fax to ETF: 608-267-4549
- Mail to ETF: ETF, P.O. Box 7931, Madison, WI 53707-7931
- Drop off at ETF: Hill Farms State Office Building, 8th floor, 4822 Madison Yards Way, Madison, WI 53705. If you want to skip the trip to the 8th floor, use our convenient, secure drop box located outside the employee entrance to the building.
Make an informed decision. Consult your professional tax advisor for assistance with completing IRS Form W-4P and tax withholding questions. ETF cannot offer tax advice or help you complete the tax withholding form.
Use ETF’s online Income Tax Withholding Calculator to calculate your federal and Wisconsin tax withholding elections.