Updated October 16, 2026. Quick answer: Only if you ask. The Department of Revenue says “Wisconsin law does not require that state income tax be withheld”, though you can ask the payer in writing to withhold.
Wisconsin pension withholding at a glance
| Item | What the documents say |
|---|---|
| Is state withholding required on regular pension payments? | No. Wisconsin does not require it; you can ask the payer |
| Default rate if you give the payer no form | No default. For any payer the amount withheld from each payment must be $5 or more; on Form ET-4310 (ETF benefits) you can use the state tax tables with single or married and exemptions, or a monthly dollar amount of $5 or more |
| Lump sum or one-time payment | The documents read do not give a separate lump-sum rule |
| Form to start, change or stop it | Form ET-4310 (Substitute W-4P) for benefits paid by the Department of Employee Trust Funds; a written request to your employer or other payor; for federal retirement system benefits, contact the U.S. Office of Personnel Management |
| Changed for 2026? | No change stated; the Department of Revenue guidance read is dated January 2026 |
What the Wisconsin documents say
Wisconsin’s Department of Revenue says state income tax withholding from retirement benefits is not required, and a payee can ask the payer in writing to withhold. If you ask, the Department says “The amount withheld from each payment must be $5 or more”.
For benefits paid by the Wisconsin Department of Employee Trust Funds, you submit Form ET-4310 (Substitute W-4P) and check Yes or No for Wisconsin withholding; the form says to check No if you do not want state taxes withheld. A new ET-4310 revokes or changes the election. The Department cites Wis. Stat. 40.08(1).
What a mover should know
This page is about Wisconsin as a state of residence. An instruction line written for a nonresident or part-year filer is not the rule for a resident, and none of the documents read settles a part-year or two-state case, so check each state’s own rule. The federal side is the same everywhere; CMG’s federal 20% withholding on a pension lump sum page covers it, state tax withholding on IRA and 401(k) withdrawals in Wisconsin covers the account side, and state withholding on retirement withdrawals lists the other states checked.
What the documents do not say
- Form ET-4310 is the form for benefits received from the Wisconsin Department of Employee Trust Funds; the documents read describe a written request for any other payer. They give no lump-sum rule.
Common mistakes
- Assuming the payer is withholding for the state because it withholds for the IRS: in Wisconsin nothing requires the payer to withhold state tax, so ask the payer in writing, or use Form ET-4310 for ETF benefits.
- Assuming the answer for one state applies to another, or that state withholding settles the state tax owed at filing.
Related: state tax withholding on IRA and 401(k) withdrawals in Wisconsin, Wisconsin retirement taxes, whether Wisconsin taxes pensions, state withholding on retirement withdrawals, and retirement withholding calculator.
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Answer againSources
- How Your Retirement Benefits Are Taxed, Publication 126 (1/26): https://revenue.wi.gov/pubs/pb126.pdf
- IRS Tax Topic 413, Rollovers from retirement plans: https://www.irs.gov/taxtopics/tc413
Sources: the primary documents linked above, read on October 16, 2026. General information, not tax advice. Your own facts decide the outcome, and a tax professional or the state agency itself is the right place to confirm anything consequential.