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2018 Major Issues Report

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Every year, before the legislative session begins, the non-partisan Office of Legislative Research (OLR) publishes a report on the major issues that could be taken up by the legislature. OLR provides brief descriptions on a number of topics, including but not limited to: the state budget, opioid drug addiction, education funding, and Connecticut’s business climate.

You can view or download the 2018 Major Issues Report HERE

Rep. Zawistowski Votes for Medicare Savings Program Fix

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HARTFORD—State Rep. Zawistowski (R-61) on Tuesday voted for a bipartisan plan that would provide funding for the Medicare Savings Program (MSP) through the end of the fiscal year.

MSP helps seniors and the disabled pay for Medicare co-insurance, deductibles and premiums. Connecticut was one of five states whose income eligibly limits exceeded the federal minimum level. The budget adopted in October reduced the eligibility to the federal minimum, consequently reducing or eliminating coverage for many of the program’s thousands of participants. The state’s Department of Social Services in December announced it would delay implementation of the eligibility reduction by two months, giving program participants a reprieve from an unexpected jump in their healthcare costs as lawmakers worked to find $53 million to fund the program through June.

“I am extremely happy that we reached a bipartisan arrangement to fund this service through the fiscal year. It is important to remember that it is not just the elderly who benefit from this program, many low income disabled persons rely on it as well,” Rep. Zawistowski said. “There are few alternative to MSP for people to turn to. The legislature’s business is not over; the regular legislative session begins in February and we will focus on closing projected deficits.”

The MSP plan was approved in the House through a 130 to 3 vote. Among the methods used to restore program funding is a requirement that Gov. Malloy reduce the number of managers and consultants—a provision included in the adopted budget ignored by the governor. Other components include moving human resources-related functions of some state agencies into the state’s Department of Administrative Services, and requiring the governor to find savings in Executive Branch functions while limiting his ability to cut more than 10 percent from any one program.

State senators approved the plan 32-1 in a vote later in the day.

Pension and Annuity Changes Begin in January

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In early June, the state legislature passed a bill which became Public Act 17-147. Under the new law, pension plan administrators or payers of pensions or annuities are now required to withhold income taxes from disbursements. Prior law allowed taxpayers to instruct their plan administrators to withhold the appropriate amount of tax but did not require they do so.  Taxpayers could choose to pay the full liability at the time they filed state income taxes.

While the new law does not affect the amount of tax owed, some pension recipients may depend on a certain amount per month for living expenses, and an automatic 6.99% deduction from the proceeds – if the proper form is not filed – may become a hardship. This is one of the reasons I did not support this bill.

Connecticut residents collecting pensions or annuities must file form CT-W4P indicating their pension and annuity withholding choices with their plan administrator otherwise the top level of 6.99% will be withheld. Differences between the amount of tax withheld and the amount actually due when filing state taxes will be assessed or returned to the taxpayer. Information about filing CT-W4P can be found at the Department of Revenue Service website. The form must be filed with your plan administrator, and not with the State of Connecticut.

It is recommended that those who receive pension or annuity payments contact their plan administrator as soon as possible – preferably before January 1 – to make certain they’re not subject to an improper amount of withholding.  Additionally, the Department of Revenue Services has updated their online taxpayer assistance information at www.ct.gov/DRS and will be available to answer questions by calling 1-860-297-5962.