Ask The Experts: Retirement

By Reg Jones

Lump-sum payout deductions, limits

Bookmark and Share

Q: In previous responses, you indicated that when a lump-sum base closure and realignment payment is made, federal and state income taxes, as well as Medicare deductions, will come out of the payment. You also indicated Social Security deductions can be taken out. As a Civil Service Retirement System employee, I do not pay into Social Security. Does that mean that no CSRS retirement payments will be taken out? Also, the lump sum will be close to $80,000 and should be paid in my last paycheck; are there any limitations on payouts?

A: Social Security deductions would only be made for those who are covered by Social Security, such as CSRS Offset or Federal Employees Retirement System workers. Neither CSRS nor FERS contributions to the retirement system will be taken out of the lump-sum payment, and there is no dollar limitation on the amount of such a payment.

Tags: , , , , , , , ,

Comments are closed.