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Withholding Changes and August 1 Benefits

In addition to the annual cost-of-living adjustment (COLA) increase, you may notice another change starting with your August 1, 2011 benefit payment. PERS switched to a new data system that uses a different tax withholding methodology. This methodology change may affect the amount of state tax withheld from your benefit payments for August 1 and the rest of 2011.
Based on a withholding election of “single, 0 exemptions,” if your gross monthly benefit payment is:

  • Less than $4,167 per month, your state tax withholding change will be negligible.
  • Between $4,167 and $10,417, your state tax withholding will increase by approximately $15.
  • Above $10,417, your state tax withholding will decrease. The maximum decrease is $56 if your payment is more than $12,000.

Your actual withholding change may be more or less than the amounts shown above based on your withholding election and because your benefit amount will change due to the annual COLA that is payable beginning August 1, 2011. The state tax withholding will change again when tax tables are updated by the Oregon Department of Revenue for the 2012 tax year.

If you want to change your federal or state tax withholding, please use the W-4P form or contact PERS Customer Service at 503-598-7377 or toll free 888-320-7377 to have the form mailed to you.