CONNECTICUT IRA TAX WITHHOLDING CHANGE: FORM CT-W4P MUST BE COMPLETED

Effective January 1, 2018, IRA distributions will be subject to mandatory Connecticut withholding for IRA owners that reside in Connecticut and maintain an IRA at a Connecticut branch.  This change is in accordance with new requirements set forth by the Connecticut Department of Internal Revenue Services.

Under the new requirements, lump sum distributions will be subject to Connecticut withholding at a rate of 6.99%.  Lump sum distributions are defined as complete withdrawal of the entire IRA balance.  All other distributions, including Required Minimum Distributions, will be subject to wage-based withholding according to the elections made by the IRA owner on Form CT-W4P, Withholding Certificate for Pension and Annuity Payments.  If Form CT-W4P is not completed and returned to us, the mandatory 6.99% will be withheld.

Your Next Steps

If you have an IRA with WLFCU, we mailed you form W4P in December.  Please complete the form and return it to Windsor Locks Federal Credit Union as soon as possible.  Your election on Form CT-W4P will be implemented for all IRA distributions beginning January 1, 2018.  If at any time you decide to change your election, please submit a new Form CT-W4P to us.

If you did not receive form W4P, you can obtain one at WLFCU.  You can also click here to download the form.  The link also provides a calculator for you to estimate your CT tax withholding amount for IRA distributions.