By Reg Jones
Pension offset
February 15th, 2012 | Government pension offset
Q: My wife began working for the post office in 1977 and retired in 2010 with 33 years of service under the CSRS Offset retirement system. During all these years Social Security was deducted from her check. She will turn 62 in October 2014, and as I understand the rules, her civil service pension will be offset a calculated amount based on the Social Security that she will be eligible to draw when she turns 62. I can understand this being the case had she not paid into Social Security. Since she paid into Social Security all those years, it doesn’t seem right that her civil service pension should be offset. If an individual worked for a non civil service company and retired, their pension is not offset by the amount of Social Security they would draw. The Social Security would be in addition to their regular pension check.
A: Your analogy doesn’t hold water. Regular CSRS employees contribute 7 percent of their salaries to the civilian retirement fund, in return for which they receive a full CSRS annuity. CSRS Offset employees contribute 0.08 percent of salary to the civilian retirement fund and 6.2 percent to Social Security, in return for which they receive the same amount of annuity benefit as their full CSRS colleagues. It just comes from two different places, the Civil Service Retirement and Disability Fund and the Social Security Administration.
Tags: annuity, CSRS offset, SOCIAL SECURITY
Offset overpayment
February 13th, 2012 | Government pension offset
Q: I retired from federal service in 2003 at age 57 under the CSRS Offset program. I am almost 66. I recently began my application for Social Security benefits and during this process “discovered” that my CSRS pension has never been adjusted for the Social Security offset which should have occurred at age 62. Is OPM going to want a retroactive repayment of the amounts I would have collected from Social Security if I had applied at age 62? How should I proceed?
A: OPM will have no choice but to seek a refund of the overpayments you received. When it does that, you’ll be told what your appeal rights are.
Tags: CSRS offset, SOCIAL SECURITY
Provision stops wife from receiving husband’s Social Security benefits
January 26th, 2012 | Benefits Creditable service: CSRS CSRS annuity computation Government pension offset SOCIAL SECURITY
Q. I am 57 and a retired federal worker. I retired under the Civil Service Retirement System at the GS-13 level. I only worked a total of about three months before my federal service paying into Social Security, so I am not eligible for any Social Security benefits for myself. However, my husband, who is 60, has worked since he was 19, and has been paying into the Social Security system since then. My understanding is that I am not eligible to receive any of his Social Security benefits because my civil service pension is too high. My question: Is this still true if he dies before me and I become a widow? Will I then be able to receive some of his Social Security benefits?
A. No. The government pension offset provision of law would reduce either benefit by $2 for every $3 you receive in your CSRS annuity.
Retirement benefits depend on retirement system
January 18th, 2012 | Creditable service: CSRS Creditable service: FERS CSRS annuity computation FERS annuity computation Government pension offset RETIREMENT SOCIAL SECURITY Windfall elimination provision
Q. My wife started working under the Civil Service Retirement System in July 1982 and continued to work under CSRS until August 1989. She is re-entering the government workforce. She plans to stop working in eight years when she will be 57, and will have 15 years of government service. It appears she would be eligible for deferred retirement benefits at age 62. How will her benefits be calculated?
A: It all depends. When she returns to work for the federal government, she’ll be covered by CSRS Offset (CSRS and Social Security), with the option of transferring to the Federal Employees Retirement System (FERS and Social Security). If she stays in CSRS Offset, her entire annuity will be calculated under the CSRS formula. When she applies for deferred annuity at age 62, her CSRS annuity would be offset by the amount of Social Security benefit she earned while covered by CSRS Offset. The dollar value would be the same but the money would come from two different sources. If she transferred to FERS when she applied for a deferred annuity at age 62, her CSRS time would be calculated under the CSRS formula and her FERS time under the FERS formula. Note: Because in both cases, she would be receiving part of her annuity from CSRS, a retirement system where she didn’t pay Social Security taxes, her Social Security benefit would be subject to the windfall elimination provision. The WEP reduces the Social Security benefit of anyone who doesn’t have at least 30 years of coverage under Social Security.
Pension reduction
October 13th, 2011 | Government pension offset
Q: I am a CSRS Offset annuitant. I know when I reach 62, my pension will be reduced by the amount Social Security will pay at age 62 if I apply. If I wait and apply later, will I get more from Social Security, or will my pension just be further offset? For example, if my Social Security is $200 at 62, they will take $200 out of my pension. If I wait until age 65 and for example my Social Security is $500, will they reduce my pension by $200 or $500? In other words, is there a financial benefit to waiting under CSRS offset?
A: The annuity of a CSRS Offset employee is automatically reduced at age 62, whether or not you apply for a Social Security benefit.
Tags: annuity, CSRS offset, SOCIAL SECURITY
CSRS Offset and Social Security
July 6th, 2011 | Benefits CSRS annuity computation Earnings test Government pension offset RETIREMENT SOCIAL SECURITY Windfall elimination provision
Q: I am getting ready to retire. I worked for the government from 1968 to 1972, then worked in the private sector and earned my 40 quarters in Social Security. I returned to work for the federal government in 1984 as a Civil Service Retirement System Offset employee. I was told that because I earned my 40 quarters from the private sector that my government annuity would not be reduced: I will get a full government annuity and a full Social Security check. Is that right?
A: By law, your CSRS annuity will be reduced at age 62 by the amount of Social Security benefit you earned while covered by CSRS Offset. Whether you will be affected by the windfall elimination provision depends on how many years of substantial earnings you have under Social Security. If you have 30 or more years, there won’t be any reduction in your Social Security benefit. If not, your Social Security benefit will be reduced. You won’t be subject to the government pension offset.
Tags: Civil Service Retirement System, CSRS, CSRS offset, Government pension offset, pension offset, SOCIAL SECURITY, Social Security quarters, WEP, windfall elimination provision
CSRS Offset and the WEP
July 5th, 2011 | CSRS annuity computation Government pension offset RETIREMENT SOCIAL SECURITY Windfall elimination provision
Q: I had 13 years of Social Security employment (max contribution) before entering the Civil Service Retirement System Offset in 1991. I am 64 years old and considering retirement at age 66. Do CSRS Offset years count in meeting the 30-year requirement to avoid the windfall elimination provision?
A: All years of Social Security-covered employment in which you had substantial earnings count toward the 30 years needed to avoid the windfall elimination provision.
Tags: Civil Service Retirement System, CSRS, CSRS offset, SOCIAL SECURITY, WEP, windfall elimination provision
Offset deductions
June 30th, 2011 | Government pension offset
Q: Can I be charged offsets on Social Security and CSRS?
A: Yes. Your CSRS annuity will be offset by the amount of Social Security benefit you earned while employed under CSRS Offset. Your Social Security benefit will be reduced if you have fewer that 30 years of substantial earnings under Social Security.
Military buyback and benefit computation
April 15th, 2011 | Benefits Creditable service: CSRS CSRS annuity computation Government pension offset RETIREMENT SOCIAL SECURITY
Q: I am 58 years old, and I started work for the government in 1981. I have 30 years of service as a Defense Department civilian employee and four years as an active-duty service member. I am under the Civil Service Retirement System and plan to retire at age 62 with 38 years of total service. I have not bought back any of my active-duty time. What impact will that have on my retirement annuity and what impact will that have if I decide to take another job after I retire?
A: Because you were first hired before Oct. 1, 1982, you have a choice as to whether to buy back your military time: If you don’t make the deposit, you’ll get credit for the time in determining your years of service and your annuity computation; however, if you are eligible for a Social Security benefit after you retire, those years will be subtracted and your annuity recomputed downward.
Tags: active duty, Active-duty service, CSRS, military buyback, military service, SOCIAL SECURITY
Social Security survivor benefit and the GPO
April 14th, 2011 | Benefits Coverage Government pension offset RETIREMENT SOCIAL SECURITY
Q: My wife passed away five years ago at age 54. She had many years of working and adding to Social Security. I am recently retired under the Civil Service Retirement System. I was told that I will not be able to receive any of my wife’s contributions to Social Security. Is that true? If so, will that law ever be changed?
A: Any Social Security survivor benefit you are entitled to based on your late wife’s work record will be impacted by the government pension offset. The GPO will reduce that benefit by $2 for every $3 you receive in your CSRS annuity. While bills have been introduced in Congress to modify or eliminate the GPO, they have never gotten off the ground.
Tags: CSRS, Government pension offset, GPO, SOCIAL SECURITY, spouse benefits, Survivor benefits