RRP is distributed at least 5 quarters after separation from service. The distribution can be changed at least twelve months prior to first payment but defers payment at least five years. Please note that your RRP amount grows at the ten-year treasury rate.
RRP benefits are subject to Social Security and Medicare taxes, typically in the year you separate from service. If you terminate in the last half of December, FICA earnings and taxes are reported and withheld in the year following termination.
Federal, state and local taxes are due and payable when RRP payments are made to you and no additional Social Security or Medicare taxes when RRP payments are made.
In many cases, having the distributions spread out over a longer period of time may reduce the tax burden in retirement. If this is an upcoming election, be sure to plan accordingly with consideration of other income source after retirement.
Read more about how we can help you understand your Chevron Employee Benefits.
To learn more about what Insight Wealth Strategies can do for you or your colleagues in San Ramon, CA or Houston, TX, please call us at (800) 318-7848, email us at [email protected] or fill out the request information form.
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