DRS Retirement Outlook – Winter 2023
The Retirement Outlook newsletter provides valuable information about DRS programs, benefits and services for active and retired customers.
- 2023 pension payment schedule
- New IRS tax withholding forms
- Retirement Readiness offering live Q&A
- LEOFF Benefit Enhancement payments began January 2023
- Listen to the DRS podcast
- DRS recognized for excellence in financial reporting
- 1099-R tax form available online Jan. 2
- Release date for 2023 COLA amounts
2023 pension payment schedule
DRS issues pension payments on the last business day of each month. Please note: The date you receive your payment will depend on your financial institution.
2023 pension payment schedule
2023 pension payment schedule
|Jan 31||Feb 28||Mar 31||Apr 28|
|May 31||Jun 30||Jul 31||Aug 31|
|Sep 29||Oct 31||Nov 30||Dec 29|
New IRS tax withholding forms
If you need to change your withholding on your pension, you must fill out an IRS W-4P. This form is used to determine your tax withholdings for pension payments or long-term periodic payments from your investment accounts.
For more accurate federal income tax withholding, the IRS made the decision to split the existing W-4P form into two forms:
• Form W-4P for periodic payments
• Form W-4R for non-periodic payments/eligible rollover distributions
What are W-4 forms?
When you retire, you receive monthly income from your pension account or withdrawals from an investment account (DCP or Plan 3). That income is taxed, and the IRS W-4 form determines how much DRS is required to withhold.
Which form do you need?
You only need to submit a new W-4P form if you would like to change your tax withholding.
For those applying for retirement:
Submit the 2022 IRS W-4P form with your application. The form will tell DRS how much to withhold from your monthly pension income.
For DCP or Plan 3 withdrawals:
Withdrawals from a Plan 3 or DCP account are taxed at a standard federal withholding rate, which is 20% for most withdrawal types. You also have the option to increase your withholding by submitting an IRS W-4R with your withdrawal request.
Retirement Readiness offering live Q&A
DRS is now offering special live Zoom Q&A sessions in 2023. Each month will feature a new topic, so there will be much to learn. Join in to ask your questions and hear what questions your coworkers have about retirement. Topics include early retirement, purchasing service credit, benefits for Plan 2 and Plan 3, and the retirement application process. Visit the DRS Webinars for dates and times.
LEOFF Benefit Enhancement payments began January 2023
Two laws enacted during the 2022 legislative session will increase LEOFF Plans 1 and 2 retirement benefits for those who qualify. Receiving these benefit enhancements will not stop lifetime monthly pension benefits and are in addition to current pension benefits.
At the end of October 2022, DRS mailed estimates providing benefit enhancements and distribution options to eligible members, retirees or beneficiaries. Following instructions on the estimates will help ensure these payments are received by Jan. 31, 2023.
For eligible members retiring after November 2022, DRS will provide their benefit enhancement options. The initial benefit enhancement payment for November 2022 retirements will be delayed until February 2023 to allow time for responses and processing.
DRS anticipates that system updates to accommodate these benefit enhancements will be complete in January 2023. Future retirees will be able to estimate and apply for these benefit enhancements using their online accounts beginning in February 2023. DRS forms and publications will also be updated.
Listen to the DRS podcast
“Fund Your Future with DRS” is a new podcast, available on all major platforms. Episodes are released on a regular basis and focus on easy things that you can do to understand your money and improve your finances.
Some of the first few episodes include:
• How to understand your spending habits
• How to analyze your income
• What is an emergency fund
• Best methods for tackling debt
The show is created by DRS customers, for DRS customers. Episodes are hosted by two DRS team members, Seth Miller and Jenny Curtiss. They open-up about their own financial journeys, working temp jobs, managing credit card debt, and tools they use for budgeting. They share money mistakes they’ve made and what they learned from it.
At DRS, we want to help people understand the financial options available to them. Planning for retirement should start decades before you retire. If people have the tools they need for managing their money when they’re in their 20s and 30s, it can help them save more for retirement.
Know someone who would love this podcast? Encourage them to subscribe on their favorite platform.
DRS recognized for excellence in financial reporting
DRS recently earned a certificate of excellence in financial reporting by the Government Finance Officer’s Association (GFOA). This marks 28 straight years that DRS has received special recognition for its Annual Comprehensive Financial Report. The Government Finance Officers Association issued its latest certificate for the fiscal year ended June 30, 2021. GFOA represents public finance officials throughout the US and Canada. Its mission is to advance excellence in public finance.
1099-R tax form available online Jan. 23
Looking for your 1099-R form for tax purposes? You can now access it by signing in to your retirement account and then selecting the 1099-R link from the main menu. From there you can view or print a copy. Hard copies of the form will be mailed by the end of January.
For Plan 3 and DCP members, starting Feb. 1, any additional 1099-R forms for your investment accounts will be available under “Statements and Documents” when you select your plan from your online account.
Release date for 2023 COLA amounts
The 2023 COLA percentages effective July 1 for most plans have not been released. DRS will update the COLA information page when the information becomes available in 2023 (usually sometime in March). You can review the current COLA adjustments that came out in 2022 on the COLA information page.
Rumors. They sure can be wild at times. At DRS, it’s not unusual for us to speak with customers who have heard a rumor that, as it so often turns out, is not exactly accurate.
The 2023 Annual Comprehensive Financial Report (ACFR) reflects our on-going commitment to accurate and transparent financial reporting of the retirement systems.
Department of Retirement Systems recently learned of several email and phone schemes targeting public employees.