Receive Income in Retirement
There are many ways you can withdraw funds from your Ohio Deferred Compensation account when it’s time. Withdrawal requests should be made by the 5th of the month, with payments typically taking place on the 20th.
Stay with Ohio Deferred Compensation
You don’t have to withdraw funds from Ohio Deferred Compensation when you retire. You can let your money continue to grow so you enjoy the benefits of being a Program participant. Remember at age 70½ the IRS mandates that you take a required minimum distribution if you are no longer working.
Regular Withdrawals – Select the frequency to receive your payments: monthly, quarterly, semi-annually, or annually. Payment options include:
- Dollar amount: Specify a dollar amount to withdraw until your account is exhausted.
- Time period: Choose a number of years you wish to receive payments.
- Annual Percentage: Pick a percent of your balance. The annual percent will be paid over the frequency you want. For example, a 12 percent annual withdrawal would be paid as 1 percent monthly.
Discretionary Withdrawals – Two options are available:
- Partial Lump Sum: Take a single lump sum payment portion of your account balance and leave the remainder to continue growing.
- Lump Sum: Withdraw your full account value in a single payment. If you have a large account balance, you may want to protect your investment from immediate taxation and consider other payment options. Your account would be closed after you receive your lump sum.
The Program is required to withhold 20 percent federal tax if you select a partial lump sum or a lump sum (required minimum distribution payments excluded). Additionally, the same 20 percent is required if you select a dollar amount, time period, or annual percent payment option that is projected to exhaust your account in 10 years or less. If your payment option is expected to last more than 10 years, you choose the amount to withhold for federal tax.
The Program is not required to withhold State of Ohio income tax from your payment. However, you may choose to have tax withheld for this purpose. No municipal taxes are due on withdrawals.
Get help about your withdrawal options
Download a Planning for Retirement brochure to learn more or contact an Account Executive for assistance at 877-644-6457. You should consult your own tax advisor before making any decisions about withdrawals.