State tax withholding for IRAs and qualified plans
Some states require residents to have state income tax withheld from retirement plan distributions.
Withholding is a pre-payment of state income tax that is a credit toward your current-year state income tax liability.
State withholding may be affected by the following criteria:
- Type of retirement plan (IRA or qualified retirement plan)
- State of residence for tax purposes
- Eligibility to roll over a distribution
- Distribution amount (a minimum amount may apply)
- Type of distribution (single sum or periodic payments)
See State Tax Information (PDF) for additional information by state of residence.