Are monthly survivor allowances taxable?
Yes, under most circumstances.* However, you may elect to have federal or California state tax withheld from your survivor allowance at whatever rate you choose. (California income tax is not withheld from your retirement allowance if you reside outside of California.) Or you may elect not to have withholding deducted from your survivor allowance. You may designate your tax withholding elections on tax form W-4P/DE-4P, which LACERA will send you. Note: Without a completed tax form W-4P/DE-4P on file, LACERA is required by law to withhold taxes from your allowance as if you were a married person claiming three (3) withholding exemptions. *Exceptions may apply in certain cases where the decedent had been granted a service-connected disability retirement.
