How to Increase Federal Tax Withholding on Military Retirement Pay
Because your military retirement pay is deposited electronically each month, it may be "out of sight--out of mind." But not having enough federal tax withheld can leave you owing money in April you hadn't planned on. Fortunately, the Defense Finance and Accounting Service (DFAS) in Cleveland makes it easy to adjust your withholding tax.
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Instructions
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Go to the DFAS Military Pay (myPay) website:
https://mypay.dfas.mil/mypay.aspx
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Log into the site using your login identification (which should be your Social Security number) and your Personal Identification Number (PIN). If you don't have a login ID and/or a PIN, click on the "contact us" link. A list of frequently asked questions (FAQs) will come up with a link entitled, "How do I obtain a Personal Identification Number (PIN), either initially or if I have forgotten or ?" Click on that link and the system will guide to through the process of gaining access.
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You will now be on the myPay main menu, which has 13 options for managing your retirement pay. Click on the "federal withholding" link. You will have three options for changing your withholding: marital status (single/married), exemptions (number of dependents), and a box to declare whether you'd like to have an additional amount withheld.
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Select how you'd like to increase your withholding. You can declare yourself "single" if you're currently being withheld at the married rate, you can reduce the number of exemptions by declaring fewer dependents, or you can simply specify an increased amount to be withheld each month. Any of those three options will work, but if you'd like to know exactly how much the increase will be, use the third option. If, on the other hand, you'd like your withholding to increase as your pay increases, use one of the first two options.
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Tips & Warnings
You can also look at your retiree account statement, to see what is actually being withheld, and manage your state tax withholding using the myPay main menu.
