WH Tax

Last August, the Minnesota Department of Revenue made changes to the instructions for Form W-4MNP, Minnesota Withholding Certificate for Retirement Account, Pension, or Commercial Annuity Payments [ [link removed] ].

Since these changes, we were informed that some retirement account, pension, and annuity payers are automatically withholding 6.25% from payments. We want to clarify when you should and should not do this.

*When should I withhold 6.25% from pension and annuity payments?*

Withhold at the default rate of 6.25%* only* if either of these apply:


* The recipient chooses this amount
* The recipient did not set a previous withholding rate or amount after you requested they do so

If your recipient:


* *Has a withholding arrangement* on payments, you must continue using it unless they send you a new Form W-4MNP. Do *not *automatically change their rate to 6.25%.
* *Does not have a withholding arrangement* on payments, contact them to complete Form W-4MNP [ [link removed] ] (Revision Date 8/15/23) before withholding at the 6.25% rate.

*Does Minnesota require withholding on these payments?* 

Yes, unless the recipient asks you not to withhold.

*What if I have questions about withholding on these payments?*

Call us at 651-282-9999 or 1-800-657-3594, or email [email protected].

We will also provide more details about the updates to the Form W-4MNP instructions, in January 2024.

 

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