District of Columbia Issues New Tax Withholding Requirements | Employment Law

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Effective December 22, 2011, as a result of recent emergency legislation, the District of Columbia Office of Tax and Revenue will require that payers of distributions from retirement plans subject to federal withholding withhold D.C. income tax at the highest D.C. income tax rate in effect at the time of distribution, presently 8.95%.

This distribution applies to the following:

(1) qualified employee benefit plans,

(2) qualified employee annuity plans,

(3) defined contribution plans,

(4) tax-sheltered annuity plans,

(5) individual retirement accounts,

(6) any combination of the plans and accounts listed above, or

(7) any similarly situated plan as defined by the Internal Revenue Code.

If you have any questions concerning this matter or any other issues involving employee benefit plans, please feel free to contact us.