By Reg Jones
Q: I’m currently an employee under the Civil Service Retirement System drawing a monthly payment from Social Security under my ex-husband’s benefits. I’ve called and visited the local Social Security office and can’t seem to get a straight answer: I understand that I can’t draw Social Security in my own right because I am a CSRS employee, but will I continue to be able to receive Social Security from my ex-husband’s (now deceased) Social Security account?
A: You might be able to receive survivor Social Security benefit while you are still working. To find out what the eligibility requirements are and the amount you would get, visit the Social Security Administration website. However, when you retire, you will be subject to the government pension offset, which will reduce any survivor benefit by $2 for every $3 you receive in your CSRS annuity. For more information, read SSA Publication No. 05-10007.
March 10th, 2011 | Benefits
Q: My husband retired with a government pension based on work for which he did not pay Social Security taxes. If he should die before me, I will receive a monthly spousal annuity payment equal to 70 percent of his benefit. He was also eligible for Social Security benefits, and the amount was reduced because of his government pension. I have not worked long enough to receive a pension or Social Security benefits on my own record. Will I be entitled to Social Security benefits on my husband’s record? And how will those benefits be affected by the spousal annuity?
A: Yes, you would be able to receive a full Social Security survivor benefit based on your husband’s work record. The windfall elimination provision doesn’t apply to survivor benefits.
March 4th, 2011 | Benefits
Q: I was a U.S. Postal Service employee from Feb. 1975 until Feb 1983. I will turn 65 in May. I am not eligible for government retirement, since those eight years were my only government employment. Nor am I eligible for Social Security benefits. Is there some way that the postal service can credit my employment with them for Social Security benefits?
A: No, there isn’t any way that can be done. On another subject, if you left your retirement contributions in the fund when you left the Postal Service, you would be eligble for a deferred annuity. If you took a refund of those contributions, you wouldn’t.
March 1st, 2011 | Benefits
Q: My fiancé has been informed he has terminal cancer. We were planning our wedding for next month. He has just applied for Social Security disability. He already collects a disability pension from a county school board, of which I am not entitled to when he passes. If we marry, how will that affect my civil service retirement pension (I am 58, he’s 62); and am I eligible to receive his Social Security disability benefits after he passes? Do we have to be married for a certain amount of time first?
A: Your CSRS annuity won’t be affected because you won’t be eligible to receive a Social Security survivor benefit. You would have to be married to him for 10 years to be entitled to one.
January 4th, 2011 | Benefits
Q: When I started receiving Social Security retirement, my Social Security employment history was just under 30 years and so a modest WEP was applied to my benefits. Early the next year, with my 30th year W2 in hand, I was able to have my Social Security benefits recalculated to an amount absent the WEP. I also have a modest CSRS pension from about 11.5 years of service. When I reached age 62, but before I began taking Social Security benefits, a CSRS offset was applied, as I understand is a requirement of law. However, now that it can be demonstrated that my full Social Security benefit is not drawn from my Civil Service, surely there must be some way to remove the CSRS offset, the stated purpose for which it was created no longer being applicable.
A: No there isn’t. Application of the windfall elimination provision results in a permanent reduction in your Social Security benefit.
Q: I am 62 years old, and my Federal Employees Retirement System disability retirement benefit has been recalculated to a regular annuity. I am still on Social Security disability. Will Social Security offset the amount that I will be getting in my annuity?
A: No, it won’t.
Q: I recently went into the Social Security office and was given three different answers by three different people regarding offsets and the windfall elimination provision. I received an increase in my Social Security monthly payment for 2011 based on my 2009 earnings. In 2009, I made more then the minimum and qualified for another year (26 years now) toward my 30-year full exemption from the offset and windfall, so should Social Security also have given me an additional 5 percent because I now have one more year of substantial earnings toward my 30-year exemption?
I was told by the Social Security office that they do not recalculate it yearly and won’t until I get all 30 years completed. I will have 27 years when they calculate 2010 earnings next year. The real question is, are they supposed to calculate the additional year that I have earned toward my 30 years of substantial earnings immediately and give me money now, or do they wait until all 30 years are completed?
A: If you are subject to the windfall elimination provision, the reduction in your Social Security benefit is determined at the point you first become eligible for that benefit and is permanent. Any subsequent increases you are entitled to based either on cost-of-living adjustments or additional Social Security-covered earnings are simply added to that original, reduced base.
Q: My question deals with my wife’s Social Security survivor benefit upon my death. I am 70 years old and my wife is 68. Both of us started taking Social Security when we were 62. I receive $1,663 in gross Social Security payments a month, and my wife receives $136. I worked in private industry and retired. My wife worked for the Defense Department and retired under the Civil Service Retirement System, never paying into Social Security. My question is, with these figures, if I died today, what would my wife be entitled to?
A: Any Social Security spousal benefit to which she’d be entitled would be reduced by $2 for every $3 she receives in her CSRS annuity.
Q: A friend told me that her monthly Social Security benefit was reduced by $250 because of the profits made from the sale of a house that she inherited from her mother. Can this be true?
A: The Social Security earnings limit only applies to earnings from wages or self-employment, and then only for those individuals who haven’t reached full retirement age. In the ordinary course of events, income received through the sale of a home wouldn’t be considered to be earnings. However, if she reported any portion of the proceeds as earnings on her federal income tax return (because she served as a real estate agent, for example) that amount would be subject to the earnings limit.
Q: I am a Civil Service Retirement System Offset retiree (15 years in offset) and turned 62 in October. I [was] scheduled to receive my first Social Security benefit Dec. 22. I have contacted the Office of Personnel Management on several occasions requesting to know how much my annuity will be offset, but no one seems to know. My annuity still has not changed. Is it normal for OPM to be late in changing (offsetting) annuities of CSRS Offset retirees? How will overpayments of my annuity be handled?
A: Because you aren’t due for your first Social Security benefit check until the end of December, it’s likely that OPM will make the reduction in your January annuity payment. While OPM doesn’t provide estimates of CSRS Offset reductions, you can get a good idea about what it will be by using the online calculator at www.FEDbens.us.
Q: I was hired after 1983 to a nonmilitary position. I left federal employment with a 40 percent Federal Employees Retirement System disability annuity. I was recently approved for Social Security disability. It is my understanding that per Federal Law 5 U.S.C. 8452(a)(2) that my monthly FERS disability check will be reduced by 60 percent of my Social Security disability benefit. That doesn’t seem fair. Isn’t there a bill pending in Congress that repeals this? Do you know which bill I should refer to when I contact my Congressman?
A: That’s the law and, to the best of my knowledge, no one has ever introduced legislation to change it.
Q: I will be retiring from federal service at age 58 with 35 years of service under the Civil Service Retirement System. I have been paying the 1.45 percent Medicare biweekly payment since its inception in 1983. Will this tax be deducted from my monthly CSRS annuity until I reach age 65? And, without 40 quarters of paying into Social Security, does paying the Medicare tax for 17 years qualify me for free Medicare Part A?
A: Deductions for Medicare Part A are only required for those who have earnings from wages or self-employment, not annuities. The fact that you won’t be eligible for a Social Security benefit has no bearing on your eligibility to be covered by Medicare Part A at age 65.
Q: I retired from the Army in 2007 and receive both military retirement pay and Veterans Affairs Department disability pay. I immediately went to work for the federal government under the Federal Employees Retirement System. When I retire from government employment, will I be paid all of the following: military retirement pay, VA disability pay, FERS retirement pay and Social Security benefits?
A: Yes, you would be able to receive all four benefits. Just remember that your FERS retirement annuity would be based solely on your years of civilian service unless you chose to make a deposit for your years of active-duty service and waived your military retired pay.
Q: Will federal retirees who pay Medicare through their federal pension because they have insufficient Social Security quarters ever receive a refund and correction for an improper raise in Medicare premiums in 2010? We, too, received no cost-of-living allowances.
A: There wasn’t any “improper raise.” What you are referring to is the fact that when there wasn’t any cost-of-living increase in Social Security benefits in 2010, an increase in Medicare premiums for Social Security beneficiaries was prohibited under the “hold harmless” provision of that law. On the other hand, there wasn’t any legal restriction to the required increase in premiums for those not covered by Social Security. I’m not aware of any plans in Congress to provide a “refund and correction.”
Q: I am a federal employee covered under the Federal Employees Retirement System. I am also paying Social Security taxes. Would I receive 100 percent of my retirement from both systems given that I retired at the stipulated age? Will my Social Security pension change my FERS pension?
A: If you retire on an immediate annuity after reaching the right combination of age and service (62 years old with five years of service, 60 with 20, or at your minimum retirement age with 30), you’ll receive an unreduced FERS annuity and, if you retire before age 62, the special retirement supplement, which approximates the Social Security benefit you earned while employed under FERS. The SRS will end at age 62, when you’ll be eligible for a Social Security benefit based on all your Social Security-covered service. As you can see, there won’t be any offset.
Q: I’m 56 years old, which is my minimum retirement age, with 12 years of credible service. If I applied for disability retirement, would I receive benefits based on my years of service or the “60 percent first year, 40 percent thereafter” rule? If I would only receive the “high-3″ times years of service calculation, what would be the advantage, if any, of disability retirement?
A: Because you aren’t eligible for an immediate unreduced annuity, your benefit would be calculated under disability rules. You’d receive 60 percent of your high-3 minus 100 percent of any Social Security disability benefit to which you are entitled. After 12 months, you’d receive 40 percent of your high-3 minus 60 percent of any Social Security disability benefit. Note: If you file for Federal Employees Retirement Service disability retirement, you must at the same time file for Social Security disability benefits. If you do not, the Office of Personnel Management will not process your application.
Q: I am a federal employee and I am also receiving Social Security benefits. I understand that when I retire and start receiving my civil service annuity, my monthly Social Security benefits will be recalculated because of the windfall elimination provision. At the time I started receiving Social Security, my number of years of substantial earnings for WEP purposes was 23. Because I am a Federal Employees Retirement System transferee, my current salary is subject to FICA. Will the years subsequent to the initial receipt of Social Security will be added to my 23 years? In other words, if I work and pay into FICA for five years after I started receiving Social Security, will my number of years of substantial earning for WEP purposes be 28?
A: It doesn’t matter where or when your Social Security credits were earned, only that you have to have 30 years (120 credits) of substantial earnings under Social Security to avoid the windfall elimination provision. The WEP applies to anyone who is receiving an annuity, in whole or part, from a retirement system, such as the Civil Service Retirement System, into which he didn’t pay Social Security taxes. To see what each year of earnings would have to be to qualify as substantial, read this WEP fact sheet.
Q: I have 33 years under the Civil Service Retirement System. Prior to that, I was with a private company and completed 32 quarters under Social Security. I will be 70 years old in June. My separation notice under the Base Closure and Realignment Act will be issued in June, and I will have to leave my job by Sept. 15. What are my best options to qualify for Social Security (40 quarters)? I understand there will be offset payments. Should I continue work two more years, finding another job after Sept. 15, and forget Social Security?
A: You can only acquire Social Security credits by earning enough through wages or self-employment to qualify for them. To earn one credit in 2011, you’d need to earn $1,120. If you do become eligible for a benefit, it will be affected by the windfall elimination provision, which reduces the Social Security benefit of anyone who receives an annuity from a retirement system, like CSRS, into which he didn’t pay Social Security taxes.
Q: I’m a disabled federal retiree drawing a federal retirement. I paid into Social Security while on National Guard status for 30 years. I’m currently working and paying into Social Security and will have enough quarters to draw Social Security payments at age 62. I understand there is an offset that will apply to my retirement. I have received a Social Security statement every year; my past statement shows I will draw around $750 at age 62. Is this my retirement amount after the offset, or do I need to reduce this amount by the offset amount? If that’s the case, what would the total amount be?
A: You are referring to the windfall elimination provision, which reduces the Social Security benefit of anyone receiving an annuity, in whole or part, from a retirement system, such as the Civil Service Retirement System, into which he didn’t pay Social Security taxes. To find out more about the WEP, visit the Social Security Administration’s Government Employee page. Once there, you can use SSA’s online calculator to see how the WEP would affect you. There’s an easier-to-use calculator here.
Q: My husband was federal technician and served in the Air National Guard. The military discharged him because of health reasons. So he lost his federal technician job. He now receives Civil Service Retirement System disability benefits. He applied for Social Security disability. Social Security counts his CSRS disability as a public disability, so his benefit is offset and his payment is reduced to $31.00 a month. Now that he is over age 55, can he change his CSRS retirement to a CSRS annuity or discontinued service retirement? Social Security stated that if he is receiving a CSRS annuity or discontinued service retirement he will not have that offset and receive $583.00 per month.
A: If his disability annuity is terminated because he has recovered from his disability or is restored to earnings capacity and hasn’t been reemployed in a position covered by a federal retirement system, he would be eligible for an immediate annuity if he met one of the following age and service requirements: age 62 with five years of service, 60 with 20, or 55 with 30. He would be eligible for a discontinued service annuity if he has reached age 50 and has at least 20 years of creditable service or is any age with at least 25 years. If his disability annuity terminates and he doesn’t meet any of these requirements, he would be eligible for a deferred annuity at age 62.
Tags: annuity, Civil Service Retirement System, CSRS, CSRS disability, disability annuity, disablity, discontinued service, discontinued service annuity, Discontinued Service Retirement, SOCIAL SECURITY