By Reg Jones
Buying back time
June 30th, 2010 | Uncategorized
Q: I am currently a 52-year-old Department of Defense Education Activity employee with 23 years in the Army National Guard (six years active). Can I buy my six years of active duty time if I will be receiving a reserve pension when I am age 60?
A: Yes, you can.
Tags: active duty time, Army National Guard, buy back, DODEA
Benefits eligibility
June 30th, 2010 | Uncategorized
Q: I worked for the Defense Department (Long Beach Naval Shipyard) from 1980 until 1990. I had a retirement fund which I paid into. When I left the shipyard in 1990, I took out my retirement fund in a lump sum. Am I eligible for any benefits from the government besides the retirement fund I paid into. I am now 63 years old. Can you explain to me how that works. Since I started working in 1980, I believe I must have been under the Civil Service Retirement System, I worked as a GS-4 for three years, then I transferred into a wage grade position: WG-10. Is there anything else I am eligible to receive?
A: Since you withdrew your retirement deductions, you aren’t eligble to receive any retirement benefits. Nor, as far as I am aware, are there any other benefits for which you would be eligible.
Tags: benefits, CSRS, Eligibility, RETIREMENT
Social Security earnings test
June 30th, 2010 | Uncategorized
Q: I provide financial services to federal employees and have been posed with a question I have not had before. My client has recently retired under Federal Employees Retirement System and has been an Army reservist for 20-plus years. Will his reservist earnings count against his FERS supplement earnings test? If he is called to active duty, are there any other considerations? And lastly, am I correct in understanding that military or reservist retired pay does not count as earnings against the FERS supplement earnings test?
A: The Social Security earnings test applies to earnings from wages or self-employment. Having been on active duty in the armed forces and served in the reserves, I know that my pay was always treated as earned income when filing my federal and state taxes. I’m not aware of any exception that would exempt active duty or reserve pay from the Social Security earnings test.
Tags: active duty, FERS, reserves
Involuntary separation
June 29th, 2010 | Uncategorized
Q: If you were a Federal Employees Retirement System dual status federal technician in the Air National Guard and
were non-retained at age 50 with 28 years of service (discontinued service retirement), can you qualify for disability retirement if you have a disabling condition? Or must you take the standard FERS 1 percent high-3 retirement?
A: If you are involuntarily separated from technician service after reaching age 50 and having 25 years of service, you are entitled to an immediate annuity, which would be computed using the standard FERS formula. If that separation is due to a disability that disqualifies you from membership in a reserve component or from holding your military grade, you may retire under the disability provisions as long as you aren’t appointed to another position in the federal government of have declined an offer of a position at the same grade or pay within your agency’s commuting area.
Special category positions
June 29th, 2010 | Uncategorized
Q: I am currently in a law enforcement position, as a Federal Employees Retirement System employee, and I am covered under the special group of employees Firefighters, Law Enforcement Officers, and Air Traffic Controllers retirement. I am considering, after 10 years of service, a lateral transfer to a GS-13 position, with the Defense Department (non-law enforcement) with more potential for promotion and a significant decrease on my commute. Since I paid an increase of .5 percent to FERS for 10-plus years, why doesn’t the 1.7 percent transfer in government to government services?
A: Under the law, only those special category employees who have completed 20 years of covered service are entitled to have their annuities computed using the more generous formula. The standard formula is used to compute the annuities of anyone who has fewer than 20 years of covered service.
Tags: annuity computation, law enforcement, standard formula, transferring positions
Social Security benefits
June 29th, 2010 | Uncategorized
Q: I plan to retire in June 2011 on my 62nd birthday. If I work up until that date and make approximately $20,000 will my Social Security benefits be reduced?
A: The Social Security Administration has a special “first year” rule that lets them pay a full Social Security check for any whole month they consider you retired, regardless of your yearly earnings. In other words, the pay you received before retiring won’t count against the earnings limit. Note: In 2010, if you are below full retirement age, you are considered retired in any month that your earnings are $1,180 or less and you did not perform substantial services in self employment.
Tags: earnings limit, first year, RETIREMENT, SOCIAL SECURITY
Disability payments
June 29th, 2010 | Uncategorized
Q: I am an 80 percent disabled veteran right now. I have applied for a Federal Employees Retirement System disability retirement, and they I was told it would take three to six months. Is that about the right time? I thought it would go through rather quickly.
I went to apply for Social Security, but until I am not working, they can’t process my claim. Same thing with Veterans Affairs. I gave them an individual unemployment form, then they said I had to wait until I am not working. Is that right? I applied for Social Security under the Wounded Warrior Program – Desert Storm and Afghanistan in 2003 Veteran – and it is supposed to be fast tracked. I also got to meet the people I need to contact when I have to file again.
Why is disability from the federal government taxable? It is ridiculous that they do that, and can you provide me info on that as well?
A: The speed with which disability retirement applications are processed by the Office of Personnel Management depends on the volume of work they are handling and the complexity of the cases that are in line before they get to yours.
The criteria for disability retirement from the civil service are different from those for the Social Security Administration. For the former, you only need to be disabled to the point that you can’t provide useful and efficient service in your current job or one that’s open at current current grade or pay within your agency’s commuting area. To be considered disabled by the Social Security, you have to be disabled for all gainful employment. If you are still working you are considered to be gainfully employed. While the VA’s rules may be the same, I’m in no position to comment about them because they apply to the military and fall outside the scope of this forum.
As a rule, civilian disability annuities are taxable as regular income, unless you are deemed to be totally disabled, a determination that is originally made by the Social Security Administration and reviewed by the Internal Revenue Service. While you may think that taxing that income is ridiculous, it is a matter of law.
Tags: disability, FERS, taxable income, Veterans Affairs
State service
June 28th, 2010 | Uncategorized
Q: I am currently a federal employee, having joined an agency in January 2010, late in my career. I am 64 years old. Between 1980 and 1987 I worked for the state and I paid into the state retirement system. Later, I transferred those funds into a private IRA. I was not vested in that system after only seven years. Can I make a deposit into the federal system for those years to add resources to what will likely be five years of employment with the federal government?
A: No, you cannot make a deposit and get credit for that time.
Tags: credit for service, federal deposit, IRA, RETIREMENT
Social Security disability benefits
June 28th, 2010 | Uncategorized
Q: I read somewhere that if you had enough quarters of Social Security, like 28 or 30, you could qualify for your Social Security pay based on that and I would get both my Federal Employees Retirement System and Social Security disability retirement money, without there being an offset. Is that correct?
A: The criteria for receiving a Social Security disability benefits are much higher than those for a FERS disability benefit. To receive such a benefit with fewer than 40 credits, you would have had to be covered under Social Security from the time you turned age 22. Under no circumstance would you receive both benefits without an offset. The FERS law is clear. If you are receiving a FERS disability benefit, during the first year you will receive 60 percent of your High-3, minus 100 percent of any Social Security disability benefit. After the first 12 months, you’ll receive 40 percent of your High-3 minus 60 percent of and Social Security disability benefit. At age 62, your annuity would be recomputed as if you had actually worked to that age.
Tags: FERS, high-3, Offset, Social Security disability
Service credit
June 28th, 2010 | Uncategorized
Q: I was in the Air Force from May 1980 to June 1993. I took a separation incentive. I have been in Federal Employees Retirement System from 1993 to present. What do I do to get the best possible retirement pay? Buy back time? Would I have to pay back the separation incentive? I am 48 years old.
A: If you want to get credit for your years of active duty service, you’ll have to make a deposit to the civilian retirement fund. In your case, that would be 3 percent of your basic military pay, not including any allowances or differentials, plus accrued interest. Doing so would add that time to your civilian service credit record and increase your annuity by at least 13 percent when you retire. You wouldn’t have to pay back your special separation incentive.
Tags: active duty, air force, deposit, FERS, retirement pay, separation incentive