Bill > SB00902

This bill proposes to modify section 12-705 of the general statutes to eliminate the current requirement that payers (such as pension funds, retirement account administrators, or employers) automatically deduct and withhold personal income tax from lump-sum payments of pensions and annuity distributions. Under the existing law, a portion of these payments would be automatically set aside for tax purposes, but this bill would remove that mandatory withholding, potentially giving recipients more control over their immediate funds. The change means that individuals receiving lump-sum pension or annuity payments would no longer have taxes automatically taken out at the time of distribution, which could impact how and when they pay taxes on these funds. While the bill does not specify the exact tax implications, it represents a shift in how pension and annuity income is initially processed for tax purposes.

Budget and Finance

https://www.cga.ct.gov/asp/cgabillstatus/cgabillstatus.asp?selBillType=Bill&bill_num=SB00902&which_year=2025