Ask The Experts: Retirement

By Reg Jones

FERS and Social Security

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Q. I am 66 years old, which is my full retirement age. I worked from 1966 to 1970 for the federal government. I was in CSRS. My credit was three years and 11 months. I stopped working in 1970 to raise a family. I withdrew the money I had paid into CSRS. Between 1970 and 2001, I held a few non-government, small, part-time or intermittent jobs in which I paid into FICA. I returned to work for the Army in December 2001. I was automatically put into FERS, so began paying into FICA and FERS. I have paid back with interest the amount I withdrew from CSRS in 1970. This will give me 16 years and three months of FERS.
I have submitted my retirement packet and applied for my Social Security pension. When I applied for SS, the form asked if I had worked at any time without paying any FICA. I said yes. The next question was “Was it government?” I said yes. Is this going to affect my SS pension? I do not really understand the Offset and Windfall rules. Read the rest of this entry »

Foreign pension and WEP

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Q. I have been a FERS employee since 1985 and this year will have 28 years of Social Security substantial earnings.

I was born in the U.K., a U.K. citizen, and worked there in the 1970s before marrying and emigrating to the U.S. with my U.S. Navy husband. I am now eligible to receive a U.K. state pension, 10 years of which are based on employment.

I am now told that my U.K. pension is subject to the windfall elimination provision, as those 10 years are not covered by Social Security. This seems grossly unfair as, at the time I earned my U.K. salary, I was not a U.S. citizen, resident or employee, and had no intentions of becoming one.

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Substantial earnings: Net or gross?

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Q. I am retired with 30 years of service. I also have 22 years of substantial earnings in Social Security. I am working as a consultant and plan to until I get to 30 years of substantial earnings.

2013 substantial earnings are $20,175 and above. I earned about $24,000. That is my gross amount. Are substantial earnings based on my gross amount or my net amount (after I deduct my expenses)?

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Windfall elimination provision

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Q. If I continue to work at a Social Security-covered job past the age of 62, will the windfall elimination provision deduction be reduced?

I retired from the Postal Service as a CSRS employee in 2004. Prior to my Postal Service time, I had 12 years of substantial earnings in the private sector. Since my retirement in 2004, I have worked for 10 years in a job that pays Social Security deductions. So, as of now, at the age of 62, I have 22 years of substantial earnings.

I have contacted the Social Security Administration and been told to use the WEP detailed calculator to determine what my benefit would be if I made a Social Security claim. However, that did not answer my question. I realize that the longer I work, the greater the Social Security benefit will be. But, as I work longer, will the WEP deduction be reduced, too? Or is it permanently set at age 62?

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CSRS Offset

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Q. I am a CSRS Offset employee with five years of “pure” CSRS and 22 years of CSRS Offset and three additional years of Social Security substantial earnings (so 25 years total of substantial Social Security earnings).

I am getting different answers as to how much my CSRS annuity will be adjusted at age 62 (i.e., the offset) and how much my Social Security benefit will be affected by the windfall elimination provision. My question is whether the combined benefit at age 62 of CSRS pension plus Social Security benefit ever ends up being less than the CSRS Offset benefit was before the offset took effect?

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Social Security

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Q. My husband is a retired federal employee receiving a CSRS pension. I have been paying Social Security taxes based on my own employment earnings since before we were married.

1. As the wife of a federal employee who is receiving a federal pension, will I receive my full Social Security benefit when I reach retirement age?

2. If I outlive my husband, how much of his federal pension would I receive, and would I also continue to receive my full Social Security?

3. Will he receive Social Security benefits based on employment earnings in nonfederal jobs he held prior to and after his federal employment?

4. If, as a retired federal employee, he will never be eligible for Social Security benefits, should he be paying Social Security taxes — which he has in the past and is doing in nonfederal jobs?

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CSRS Offset at 62 vs. 65 or 66

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Q. I am a retired federal employee covered by CSRS Offset with 31+ years of federal service. I understand that, at age 62, my CSRS federal pension will be reduced and Social Security will pay the reduced amount to receive approximately the same in monthly annuity. Would my Social Security amount increase if I did not claim Social Security until I reached age 65 or my full Social Security retirement age? Also, I believe I have 30 years of substantial earnings with Social Security. Does this have an impact on when and how much I will receive from Social Security after age 62?

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CSRS Offset

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Q. I am CSRS Offset. It is my understanding that when I apply for Social Security, a portion of my CSRS Offset retirement will be SS. My question involves my husband’s collection of his SS.  When he passes, will I be eligible for his SS? I know his is more and we are making retirement plans for him.

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FERS, state job and Social Security

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Q. I just retired from federal service with 23 years plus four years military bought back. I am starting a job with the Teachers Retirement System of Texas, in which I do not pay into Social Security. How will this affect my Social Security benefits later, when I start to take them?

Let me ask two examples:

1. I am 51 now. If I choose to work for TRS for 12 years, retire and take a partial retirement from TRS (vested after five years) along with my FERS retirement, and then want to start taking Social Security payments at, say, age 63, what will be the effect at that time on my Social Security payments?

2. If I work for 12 years with TRS but leave service (not retire, just leave), will this have any effect on my Social Security payments when I start to take them? Can I take the funds from my TRS account and roll them over into another retirement account without paying federal tax or paying a penalty?

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CSRS Offset

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Q. I started working for the Postal Service in 1983. I also worked before that for the Navy and other places and have received a Social Security Administration statement saying I will be eligible for Social Security benefits at age 66. Is there a percentage that is deducted from either my Postal Service retirement or Social Security benefits? What is CSRS Offset? Am I in that, or would I know if I were?

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Medicare Part A and Social Security

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Q. I am CSRS. I earned my 40 quarters before becoming a fed. I plan to retire May 2 at almost 65 years old. I am not going to apply for Social Security until 66. I will have almost 37 years of combined federal service. When I apply for Medicare Part A at 65, there will be no cost, correct? When I go on Social Security, there will be no cost for Medicare Part A, correct?

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CSRS Offset

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Q. I am under CSRS Offset. I retired in 2009 at age 57 with 30 years of service, went back to work as a contractor and am still working. I have paid into Social Security for approximately 40 years. Will there be an offset in my retirement when I turn 62?

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Windfall elimination provision

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Q. I worked 10 years under Social Security (40 quarters) prior to entering federal service under CSRS in 1979.

I retired last year at age 65 and intend to apply this year for Social Security when I turn 66.

Will the Social Security retirement payment not be reduced by the CSRS Offset because the Social Security contributions were made before the federal service employment with no overlap?

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Switching to FERS and the WEP

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 Q. I retired as a FERS employee. I worked for the federal government for 32 years. The last 12 years, I switched to FERS and paid Social Security. I was under the impression that I would receive my full Social Security once I applied for it, without the windfall elimination provision. Is this correct?

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CSRS Offset

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Q. I’m under CSRS Offset, but I have 36 years of substantial earnings under Social Security. Will either pension be reduced?

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Social Security

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Q. I will be 62 on Sept. 3 and will still be CSRS for another year or so. Can I collect 100 percent of my Social Security amount for age 62 at that time?

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Social Security ‘quarters’

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Q. I am a CSRS employee who started with the Postal Service in 1981. However, I worked in a supermarket before the USPS and worked for the union for the past six years. For both of those other jobs, I have paid and still am paying Social Security. I have heard the expression of “having enough quarters” for Social Security retirement. What does that mean, and how many quarters are needed?

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Windfall elimination provision

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Q. I retired under CSRS after 26 years of service. I worked for six years before my federal service and have been working and paying Social Security for the past nine years. If I put in 20 years under Social Security, will I still be affected by the windfall elimination provision?

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CSRS Offset and WEP

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Q. I was in CSRS for nine years (1965-1974) before having a 15-year break in service. When I returned to work for the government (1989), I was placed in CSRS Offset until my retirement in January 2013.

I am receiving Social Security benefits, as well as my reduced CSRS Offset government pension. During one of my calls to Social Security regarding my benefits, I was told that I have paid into Social Security for 29 years and that, if I could get one more years earnings paid into Social Security, that the amount of the CSRS Offset reduction would not apply. My understanding was that I would then be able to collect my full government pension, as well as my Social Security annuity.

In a follow-up call to Social Security, I was told that this reference applied only to my Social Security annuity.

I am trying to determine if it would be beneficial for me to return to work to reach the 30-year requirement.  Can you confirm which statement is correct?

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FERCCA and WEP

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Q. In the Dec. 2 article titled “Don’t let these 5 mistakes disrupt your plans,” in mistake number 4, you wrote “If you are covered by CSRS (or FERS and will have a CSRS component in your annuity) and will also be eligible for a Social Security benefit, you’ll be subject to the windfall elimination provision. The WEP reduces the Social Security benefit of anyone receiving an annuity — in whole or part — from a retirement system where he didn’t pay Social Security taxes and has fewer than 30 years of substantial earnings under Social Security.”

A co-worker said they just attended their first retirement seminar, and they may be Federal Erroneous Retirement Coverage Corrections Act eligible (they were in CSRS and placed into FERS without their consent around 1987). They are going to contact our personnel office and have it confirmed that they should be in CSRS.  From the article item #4, I am wondering if the following is correct:

If you have more than 30 years of Social Security earnings and get your FERS status changed to CSRS, which would cease you being taxed for Social Security, once you retire and were 62 years old, would you be eligible for a Social Security benefit and not be subjected to the windfall elimination provision?

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