Federal tax
Usually 95-98% of TRS of Georgia benefits are subject to federal income tax. Contributions after July 1, 1987 were not taxed, so only older taxed contributions are recovered tax-free through a monthly exclusion. You receive a 1099-R each January. Member's Guide p. 21, Federal and State Tax Withholding
Georgia tax
Monthly TRS of Georgia benefits are subject to Georgia income tax for Georgia residents. Residents of other states should check with their state's Department of Revenue. Member's Guide p. 21, Federal and State Tax Withholding
Georgia's retirement income exclusion
Per the Georgia Department of Audits and Accounts (February 2023 summary): taxpayers 65 and over may exclude up to $65,000 of retirement income, and those 62 to 64 (or permanently and totally disabled) up to $35,000. It covers retirement income such as pensions, interest and capital gains, plus up to $4,000 of earned income. Limits are per taxpayer, so a married couple filing jointly may exclude twice the limit. Ga. Dept. of Audits, Retirement Income Exclusion summary (Feb. 2023), p. 1, Background
| Your age | You may exclude up to |
|---|---|
| 65 or older | $65,000 |
| 62 to 64, or totally disabled | $35,000 |
Per person, as of February 2023. The TRS of Georgia sources don't mention the exclusion.
The $35,000 and $65,000 exclusion amounts come from a February 2023 state audit summary, not from TRS of Georgia or the Department of Revenue. They may have changed.
What we use: those amounts, shown as dated. Check the Georgia Department of Revenue for this year.
Lump sums
PLOP: Paid directly, TRS of Georgia withholds at least 20% for federal tax; an extra 10% IRS penalty may apply under age 59-1/2. You can roll it over to defer tax. Georgia residents also owe Georgia tax on a PLOP. trsga.com, Partial Lump Sum Option Plan (PLOP), Tax Implications
Refunds: TRS of Georgia withholds 20% for federal tax unless you roll the money over, and the IRS may add a 10% penalty if you're under 59½. Member's Guide pp. 4-5, Termination: Withdrawing Your Funds
What the guide says
- Usually 95-98% of your TRS of Georgia benefit is subject to federal income tax.Member's Guide p. 21, Federal and State Tax Withholding
- TRS of Georgia benefits are subject to Georgia income tax for Georgia residents. If you live in another state, check with that state.Member's Guide p. 21, Federal and State Tax Withholding
- Check with TRS of GeorgiaGeorgia lets taxpayers 65 and older exclude up to $65,000 of retirement income, and those 62-64 (or totally disabled) up to $35,000, per person. TRS of Georgia's own materials don't mention this.Ga. Dept. of Audits, Retirement Income Exclusion summary (Feb. 2023), p. 1Figures are from a February 2023 audit summary, not current Department of Revenue guidance.
Questions
Is my TRS of Georgia pension taxed?
Yes. Usually 95-98% of it is subject to federal income tax, and Georgia residents pay Georgia income tax on it.
Does Georgia exclude some retirement income?
A February 2023 state audit summary says people 65 and older can exclude up to $65,000, and those 62 to 64 up to $35,000. Check the current amounts with the Georgia Department of Revenue.
What if I move out of Georgia?
Check with your new state's Department of Revenue.
Source: Teachers Retirement System of Georgia Member's Guide, 06/26, pp. 4, 5, 21; trsga.com pages; Ga. Dept. of Audits summary (Feb. 2023). Last reviewed .