Ask The Experts: Retirement

By Reg Jones

Location and high-3

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Q. I am a Defense Department employee in Washington D.C. If I change my locality three months before I retire Jan. 1, when I retire would the lesser locality pay kick into my base and be used as the high-3?

A. How may times do I have to say this? Your high-3 is your highest three consecutive years (78 pay periods) of average basic pay, regardless of when they occur in your career.

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Annuity taxes

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Q. I’m a recent federal retiree and I’m trying to project my income for the year. Is the starting point for the taxable portion of my monthly annuity the amount before or the amount after the survivor’s benefit is deducted? From what I gather from IRS Pub 721, the deduction is a pre-tax deduction, but it lowers the tax-free portion amount of my monthly annuity. Is this correct? Read the rest of this entry »

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Lateral transfer, step increase

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Q. I was approached with a lateral transfer from a GS-1071-9 Step 4 to a a GS-1030-9. I told them I would consider it with monetary compensation (I had a step increase in mind). They responded that they couldn’t do that and would open the position to the outside. Is this true that I could not request a step increase to go with the lateral transfer?

A. Yes, what you were told is correct.

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Night differential

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Q. Is night differential (shift work) added to my high-3 when calculating my retirement annuity?

A. No, it isn’t, unless you are a wage system employee. Then it is.

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High-3 computation

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Q. Between 2009 and 2012, I served two deployments in Afghanistan as a GS employee (CSRS). Can my salary during those deployments be used in the computation of my high-3?

A. No. Only actual basic pay earned while a federal civilian employee can be used in that computation.

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Withdrawn CSRS contributions

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Q. I left government service in 1995 and withdrew all of my CSRS contributions so I could start a business. I have never returned to federal service. I had over 15 years service including my military service time. Even though I withdrew my contributions, do I still have any pension available to me? Also, is it possible at this point to repay those contributions? I am now age 68. Read the rest of this entry »

Government contributions to retirement fund

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Q. I’m a CSRS employee with more than 41 years of service and plan to continue my federal employment well beyond 41 years. I understand that CSRS employees contribute 7 percent of their salary into the retirement fund and that the government matches that 7 percent contribution into the fund. I’m told that, after completing 41 years, 11 months of service, I will reach the maximum annuity benefit of 80 percent. At that point, the 7 percent retirement contributions will continue to be taken from my pay and placed into an interest-bearing account to be refunded when I retire. When that happens, does the government continue to pay its matching 7 percent contribution into the interest-bearing account as well? Read the rest of this entry »

Federal, state annuity offset

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Q. I am CSRS and worked 20 years between 1983 and 2004. I am considering taking a job in a Texas school district.  Will there be any offset between my CSRS annuity and my Texas state annuity?

A. No, there won’t.

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Supplement calculation

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Q. As a retired federal law enforcement officer who earned a law enforcement retirement under FERS, I am approaching my 56th birthday. Since the SRS supplement will be discontinued or reduced at age 56 (MRA), I am curious as to how this amount is calculated? I am aware it will be reduced for anything I earn over $15,480 annually, not counting my pension. Will OPM send me an inquiry, or is this something I am supposed to submit? Do they base it on my earnings when I turn 56, or the previous year’s earnings? I would like to keep the full amount, so I am considering when to leave my current employment. Read the rest of this entry »

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Deferred retirement

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Q. I am 50 and I have been in government for 27 years. I am going to apply for a deferred retirement at age 60 or 62.  I thought I read somewhere that the “high-3″ was consecutive. If I was a GS-13 and due to BRAC had to come back into the government at a much lower grade, could I still use my high-3 including grades 11-13 or am I required to use the last grade I held?

A. Yes. Your high-3 is the highest three consecutive years of average basic pay (78 pay periods), regardless of when they occur in your career.

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TSP and taxes

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Q. I intend to make a lump-sum payment this year to pay off the balance owed to recapture my military service for inclusion of this time toward my FERS retirement. I am paying it with after-tax dollars I have saved. Can this amount be claimed as a tax credit or claimed as a tax deduction? Which document says what can be claimed or that neither can be claimed?

A. No. It can neither be claimed as a tax credit nor a tax deduction.

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Social Security earnings

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Q. I am 62 and would like to retire and receive my social security. What is the most I can earn per week without my benefit being cut?  Read the rest of this entry »

VSIP Amount Calculation

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Q. I received $19,100.00 severance pay in a RIF in 1996. In 2000 I was re-employed by the Federal Government. I am now considering a VSIP. What amount can I expect? I am 72 years old with 20 years of service. Read the rest of this entry »

Lump sum for unused annual leave

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Q. How soon would I receive my lump sum payment for unused annual leave when I retire?

A. Only your agency payroll office can answer that question.

Military Buyback and Pay Increases

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Q. I will be separating from the military in September 2014 with 11 years, six months service. I am looking to get a federal GS job where I can buy back my military time. I know this goes toward the pension plan, but does it also count anything toward GS within-grade pay increase? Read the rest of this entry »

Within grade pay increase

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Q. I will separate from the military in September with 11 years, 6 months of service. I am looking to get a federal GS job where I can buy back my military time. I know this goes toward the pension plan, but does it also count anything toward GS within-grade pay increase?

A. As a non-retired former member of the military, your active-duty service will be used to establish your service computation date and, thus, your annual leave accrual category. It doesn’t count toward the step at which you are hired. However, if you have special skills that would make you highly desirable, you can try negotiating for a higher entry step with the agency that is considering hiring you.

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Retirement age

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Q. If you worked full time for the federal government for six years and part time for four years, and retired at age 62, can you obtain federal retirement then?

A. Yes. In fact, you would only have to have five years of service to be entitled to a retirement annuity at age 62.

 

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Buy back

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Q. I have 20 years at the VA and two years of military service of which I paid back to get credit. I worked in the Postal Service from 1970 to 1977 and took out my retirement.  Can I repay, with interest, that money to receive credit for those seven years?

A. Yes, you can.

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‘Retire, FERS’ refund

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Q. My wife worked for the federal government from 2011 to 2012 and resigned in August 2012 due to medical reasons. During that two years of service, $222.07 was deducted from her pay for “Retire, FERS” and there were matching funds of $3281.31, so the total is $3503.30 for the “Retire, FERS.” Can my wife request that money be refunded?

A. If she doesn’t plan to return to federal service, she would only be entitled to a refund of her own retirement contributions. Doing so would cancel her entitlement to any future retirement benefit. However, if she got a refund and later returned to federal service, she could redeposit that money, plus accrued interest, to get credit for that period of service.

 

Retirement annuity after job switch

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Q. I have recently retired from an air traffic controller job, collecting a retirement annuity from the government. I am 55 years old and was wondering if I can now get a job with another government agency (Homeland Security) and still retain my retirement annuity. Is there anything written about this, and where would I find it?

A. Whether you can get a job with another agency is up to them. As a rule, your new salary would be offset by the amount of your annuity. However, there are limited authorities that allow an annuitant to receive both his annuity and his full salary. Before you accept a job, you’ll have to be sure which rule applies. If you find a position that allows you to receive both, when you retire again, your annuity won’t be recomputed to include that new period of service.