By Reg Jones
Windfall elimination
February 21st, 2012 | Windfall elimination provision
Q: I have been unable to identify if there is an exception to the windfall elimination provisions that will allow me simultaneous entitlement to a CSRS annuity and to full or non-reduced Social Security benefits. I assume
that Social Security benefits are not subject to reduction under the windfall elimination provisions if the credits earned were earned as a
federal employee and during the time period (15 years) in which the credits were earned, I made no payments into any other retirement system. I think that benefits earned under the CSRS system were earned during a time period (20 years) when I made no contributions to the Social Security trust fund. The facts are that I am a CSRS annuitant, I also earned 60 Social Security credit hours employed by the federal government in which both the federal government and I paid into the Social Security
trust fund for the hours earned and during which I was paying into no other retirement system other than Social Security. There were two separate periods of time associated with his situation: 20 years payment into the CSRS system and approximately 15 years paying into Social Security as a federal employee. Can Social Security payments be reduced where the Social Security credits earned were earned as a federal employee and no payments were made into the CSRS system, or any other retirement system, during the time the payments made?
A. No. To see how and why the windfall elimination provision is applied and what the exceptions are to it, go to www.socialsecurity.gov/pubs/10045.html.
Tags: CSRS, SOCIAL SECURITY
Subject to WEP
February 17th, 2012 | Windfall elimination provision
Q: I am a 55-year-old recently retired postal employee and I receive a CSRS annuity every month. I plan to collect Social Security benefits when I reach age 62. I have been working part time and paying into Social Security as well as working my full-time position for approximately 30 years. What will the reduction to my Social Security be because I am a CSRS retiree?
A: Because you are receiving an annuity from a retirement system where you didn’t pay Social Security taxes, you’ll be subject to the windfall elimination provision. The WEP will reduce your Social Security benefit if you have fewer than 30 years of “substantial earnings” under Social Security. Substantial earnings are greater than those required to earn Social Security credits. To see what substantial earnings are by year and to estimate the reduction in a Social Security benefit, go to www.socialsecurity/pubs/10045.html.
Tags: CSRS
WEP and taxes
February 16th, 2012 | Windfall elimination provision
Q: I worked four years in a supermarket and another 20 years in the U.S. Air Force, bringing my U.S. Social Security years worked up to 24.I returned to Spain and began working and now have 20 years in the Spanish Social Security system which gives me another retirement. I paid taxes on my U.S. earnings at the time and now pay taxes on my Spanish earnings. If you are paying taxes does the WEP come into play?
A: Yes, you will be subject to the windfall elimination provision if you have fewer than 30 years of substantial earnings under Social Security.
Tags: SOCIAL SECURITY
Benefits, CSRS Offset and WEP
January 25th, 2012 | Creditable service: CSRS CSRS annuity computation SOCIAL SECURITY Windfall elimination provision
Q. I’m a Civil Service Retirement System Offset employee with 18 years, 6½ months, under straight CSRS; 12 years, 7 months, at retirement (April 30, 2012); and with at least 40 quarters earned under Social Security before federal service. I had an appointment the other day at the Social Security Administration to see what my benefits, offset amount and windfall amounts would be. The person who I talked to had no idea about the CSRS Offset and kept calling the windfall elimination provision (WEP) an offset. She insisted she never had to consider/calculate the offset amount for the Office of Personnel Management, and that OPM would do the calculations and she just had to do the WEP calculations.
My first question: At the time of retirement, does OPM notify a Social Security office where there are people who have dealt with CSRS Offset and WEP and will calculate my benefits properly and correctly?
My second question: What figures and formula do I use to figure out my benefit amount at 64, my offset amount and the WEP amount?
My third question: My full retirement age is 66; retiring at 64 will reduce my full retirement benefit. The offset amount is calculated against the total amount I’m due at 64; that amount reduces the CSRS annuity, not the Social Security amount, and the combination of the two amounts will total the same as the original CSRS benefit. Is the WEP also calculated against the amount I’m due at 64?
A. For a primer on CSRS Offset and how and why your annuity would be offset, read OPM’s Retirement Fact 13 at http://www.opm/forms/pdfimage/RI83-19.pdf. For the full story on how the offset will be calculated, go to http://www.opm.gov/retire/pubs/handbook/C050.pdf and scroll down to Section 50A3.1.1-4.
For a primer on the WEP and how and why your annuity might be affected, read the Social Security Administration’s WEP Fact Sheet at http://www.socialsecurity.gov/pubs/10045.html. Then use the calculator at http://www.socialsecurity.gov/retire2/andPiaWepjs04.htm to determine what effect the WEP would have on your Social Security benefit.
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.
Double negative?
October 11th, 2011 | Windfall elimination provision
Q: I am a GS-13 planning to retire at 70 with 19 years in CSRS, 11 years in CSRS Offset, and 19+ other substantial years under Social Security. No matter how many times I read the other questions and answers, I keep thinking they say my total retirement will be the sum of my CSRS retirement reduced by the net Social Security benefit after WEP reduction, PLUS the net Social Security benefit after WEP reduction. In other words, Total = (CSRS – (SS-WEP)) + (SS-WEP) = CSRS as if Social Security doesn’t exist. Am I confused? Can you straighten me out?
A: When you retire, the CSRS Offset portion of your total annuity will be offset by the amount of Social Security benefit you earned while a CSRS Offset employee. The net result will be the same. The payments will just come from two places, OPM and the Social Security Administration. Because you will have 30 years of substantial earnings under Social Security, the windfall elimination provision won’t apply. As a result, neither the portion of your Social Security benefit earned under CSRS Offset nor the additional benefit earned elsewhere will be affected.
Tags: CSRS, CSRS offset, SOCIAL SECURITY
CSRS offset
August 2nd, 2011 | Windfall elimination provision
Tags: CSRS, CSRS offset, windfall, windfall elimination provision
Offset years
July 19th, 2011 | Windfall elimination provision
Q: I had 13 years of Social Security employment (max contribution) before entering CSRS Offset in 1991. My salary was always maximum Social Security contribution. I am 64 and considering retirement at age 66. Do CSRS Offset years count in meeting the 30 year requirement to avoid WEP?
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: 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