Taxes and Your Benefit
PSRS benefits are subject to federal income taxes, and Missouri income taxes if you live in Missouri. We cannot advise you on whether you should have taxes withheld. However, if your tax withholding is not sufficient to meet your tax liability, you may be subject to penalties and interest in addition to your tax obligation.
PSRS/PEERS employees do not offer tax advice. The following information is provided as a reference only. It is recommended that you speak with your tax professional or the Missouri Department of Revenue for tax advice.
How Much of your Monthly Benefit is Taxable?
- Most contributions you have made to PSRS are taxable when returned to you in the form of benefits.
- However, if you made contributions to PSRS prior to July 1989, or made payments to reinstate or purchase service using previously taxed dollars, those funds are exempt from additional tax when returned to you in the form of benefits.
- If you have no previously taxed funds in your account, your entire benefit is taxable.