By Reg Jones
Failed annuity reduction
February 13th, 2012 | Other pay adjustments
Q: I have been trying to find CFR’s or other federal regulations that instruct how disability retirement annuites are to be reduced from 60 percent to 40 percent after the first year. My annuities were never reduced automatically by the Operations Retirement Center. The IRS and I noticed something wasn’t right on my 1099R, so I initiated an ivestigation to look into my account. They discovered an overpayment for the last two years, now they want it paid back. So, I am pleading my case and want to find regulation language describing that OPM is responsible or is supposed to automatically reduce my annuities and/or handle my account.
A: You’ll find everything you’re looking for at www.opm.gov/retire/pubs/handbook/C061.pdf. Just scroll down to Section 61B.
Tags: OPM
Retention pay
June 1st, 2011 | Other pay adjustments
Q: I receive retention pay of 10 percent of my base salary. I have run across articles that indicate that retention pay can be used to calculate the high-3. Is that true?
A: As a rule, recruiting and relocation bonuses and retention allowances are not considered part of the basic pay of an employee for any purpose, including calculation of retirement annuity. Since a high-3 is based solely on basic pay, the amount from which retirement deductions are taken, you can get a pretty good idea about how your pay is being treated by looking at your latest pay slip. For a more accurate answer, you can visit your local payroll office.
Tags: high-3, payroll, retention pay
Credit for annual reserve training
March 2nd, 2011 | Other pay adjustments
Q: I heard you could receive FERS retirement credit for the two-week annual training sessions of reserve duty. If so, what records are needed, and where can former reservists obtain them?
A: You already received credit for that time. 5 U.S.C. 6323 (a) provides 15 days per fiscal year for active duty, active duty training and inactive duty training. You can’t get credit for it twice.
Locality pay buyback for retirement
March 9th, 2010 | Other pay adjustments
Q. I am retiring and live in Alaska. I want to determine how and when I would be allowed to buy back the locality pay/COLA pay percentage I worked for, since January of 2010. I am suppose to be able to buy back the portion of my locality pay rate that I would be entitled to. The P.L. 111-84 was effective Jan. 1, 2010 and I retire on April 2, 2010. That would amount to three months that I could pay back to obtain the full RUS rate, which is 13.86 percent for this part of the year that I worked before I retired. Since we are currently receiving 4.62 percent, I assume that the difference I would be paying back amounts to 9.24 percent (13.86 percent – 4.62 percent) for the three months of pay I would need to pay back. I don’t know what amount I need to take that 9.24 percent X ??? to determine what amount I need to write a check to, and to whom to write the check to?
I continue to receive conflicting information on how to proceed with this. Neither the CPAC personnel office, the ABC-C nor OPM folks know what to do. They refer me back to the other and no one has been able to help me or to direct me to a solution. Do I need to deal with the Denver payroll office, OPM, the ABC-C Army benefits center or my CPAC personnel office? I seem to be stuck in neutral on this matter.
I am retiring April 2, 2010 and I believe that I need to have this taken care of prior to my retiring. So I’m running out of time. I need to submit my paperwork for retirement this week, so time is of the essence.
A. No, I can’t provide any specific guidance. Until OPM issues such guidance, everyone will have to be patient. What I can give you is a summary of the legislation that OPM provided to agencies in January:
“[The new provisions of law] permit a phased conversion from non-foreign COLA to locality pay over a three-year period beginning in 2010. Individuals who separate from service from 2010 through 2012 will have the right to elect to have non-foreign COLA allowances received during the period count toward retirement credit, to the extent that the non-foreign COLA allowances plus any locality pay received do not equal more that the RUS [Rest-ofU.S.] locality pay. Such election must be filed not later than December 31, 2012. The statute makes provisions for agency and employee payments based upon these elections, which must be made to OPM. OPM will issue regulations to carry out the election and payment process.”
Tags: locality pay, OPM
BRAC payouts and pay cap limits
February 9th, 2010 | Other pay adjustments
Q: Do biweekly or yearly pay cap limits apply to restored Base Closure and Realignment Leave?
A: No, they don’t.
Tags: BRAC, pay caps, restored leave
Taxable earnings for CSRS Offset
February 9th, 2010 | Other pay adjustments
Q: In your Jan. 25 article “New year, same COLA,” you say that the Social Security withholding stays at $106,800, and that “if you are a Federal Employees Retirement System or Civil Service Retirement System Offset employee, any amount you earn above that amount won’t be subject to the 6.2 percent Social Security deduction.”
However, I am a GS-810-14, Step 10, Forest Service employee under CSRS Offset and the National Finance Center withholds Social Security from my paycheck for the entire year. Withholding from my paycheck doesn’t cease at the $106,800 limit. This seems contradictory to what the article states. Can you please explain?
A: According to the Office of Personnel Management, when the total basic pay paid in a calendar year reaches the Social Security maximum taxable wage base, the deduction rate reverts to the “full” CSRS employee withholding rate. Agencies must ensure that the deductions on the first dollar of basic salary paid to CSRS Offset employees over the Social Security wage base are made at the full CSRS rate and that the reversion to full withholding is reflected during the pay period in which it occurs. While the place that the deductions go — Social Security or OPM — will change, the amount that’s deducted stays the same. That’s because most CSRS Offset employees contribute 0.8 percent to CSRS and 6.2 percent to Social Security, for a total of 7 percent. When the wage base is exceeded, 7 percent is paid to CSRS.
Tags: civil service, CSRS, Offset, RETIREMENT, SOCIAL SECURITY
GS basic pay and shift differential
February 2nd, 2010 | Other pay adjustments
Q: I’m curious about the rationale behind shift differentials counting toward a WG employee’s basic pay and high-3, but it doesn’t count for GS employees. Why is this? Is this an OPM regulation? Is there a way I can learn more about what I see as an inequity to GS employees because shift differential doesn’t count toward their high-3?
A: Shift differentials for wage-system employees are provided for in law. Such a provision isn’t needed for general-schedule employees because these and other factors are included when determining their job grades.
Tags: differentials, employees, shift