RRP moves to your Fidelity account shortly after you leave payroll and taxes are withheld. You can only start to access the money 12-15 months later. What year do you actually owe the tax on your federal filing? When fidelity gets it or when you get it?
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RRP = Restoration Retirement Plan
Applies to executives
How you get your RRP depends on if you elected to take it as a lump sum or deferred it. The lump sum you get 30-60 days after your last day at CVX. Deferred starts depending on when you elected to take it but can be no sooner than the first day of a quarter at least 12 months after your last day. So as an example if you last day is September 30, 2020 then you would get the first payment October 1, 2021. If your las day is October 1, 2020 you would get the first payment January 1,2022. After that all subsequent payments are made on January 1 of each year.
Social Security and Medicare are taken out when it transfers to Fidelity. If you already hit it the SS limit, which if you get RRP should have been in the first quarter of a year then only Medicare taxes are taken out. While in Fidelity it draws interest at the 10 treasury rate. Income taxes are withheld when you receive the deferred payment.
What is RRP?
Now i am confused, when do you have to pay taxes on the rrp?
This is new to me. My understanding is we get the RRP 13 months after our last check, then taxes will be taken out and remainder will can be put into after tax accounts.
Now you will get your lump sum right after your last check but most people will roll it over into an IRA account.
Medicare and Social Security, if not past the limit, taxes paid / taken out this year.
Federal taxes required in year(s) received.
Interest is paid while you wait, but that will not be much