Ask The Experts: Retirement

By Reg Jones

Military buyback

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Q. I recently spoke with an individual from the Office of Personnel Management’s retirement services regarding offset of FERS pension for Veterans Affairs disability. The individual told me that my VA disability would not be offset from my FERS pension if I was combining my military time with my civil service time. However, the individual also told me that if I buy back my military time and then waive my military retired pay all of my military benefits, medical, ID card, commissary, etc., would also be stopped. Has the law changed?

A. I’m not aware that anything has changed. However, neither someone at OPM nor I are qualified to tell you what happens to your other benefits if you waive your military retired pay. You’ll have to check with your branch of service.

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Taxes

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Q. How does my dad change the amount of taxes to be taken out on his civil service retirement check? He is not taking out enough and is getting penalized.

A. Have him call the Office of Personnel Management at 1-888-767-6738 or 724-794-2005 and talk to one of the benefits specialists.

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65 or 66?

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Q. I have been retired under Social Security disability since 2000. I declined Part B because of federal insurance. My Postal Service disability turned over to regular pension at age 62.  I am now 64. According to new law, I am eligible for regular Social Security at age 66. Will my federal Blue Cross/Blue Shield continue until age 66, or does it end at age 65? And do benefits change at all? Do I then have to apply for Part B at 65, or do I wait to apply at 66? And do I have to pay a penalty for all of those years I didn’t apply while on BC/BS? Everywhere says apply for Part B at age 65, but does that apply even though I am eligible for regular Social Security at age 66?

A. Your Federal Employees Health Benefits program coverage will continue as long as you keep paying the premiums. In your case, I assume that you are doing that through deductions from your annuity. Whether you decide to enroll in Medicare Part B is up to you. You’ll first become eligible for Part B when you reach age 65. The law covering Part B is separate from the one that determines your eligibility for a Social Security benefit.

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Excepted service and RIF

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Q. I am 52 years old and have 12 years in a federal excepted service position. Due to my excepted service status, do I understand correctly that I have no bump or retreat rights in the event of a reduction in force? For what retirement benefits would I be eligible under these circumstances?

A. If you left your contributions in the retirement fund, you would be eligible for a deferred annuity at age 62.

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Social Security disability benefits

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Q. I’m 50 years old, have worked for the Postal Service for 28 years, and am eligible for the voluntary early retirement offer. Would I be eligible to apply for Social Security disability benefits also? I am with FERS and have been profoundly deaf since birth.

A. As a FERS employee who is covered by Social Security, you would be eligible to apply to SSDI. To find out if you would qualify for that benefit, go to www.ssa.gov/dibplan/dqualify.htm.

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USPS retirement, spouse death and remarriage

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Q. I am a 77-year-old widow of a postmaster with 30-plus years’ service who passed away in 1993. I have since received spousal benefits plus insurance coverage. I do not receive Social Security. I have not remarried. However, if I marry a widower who retired from military service (Marine officer and FBI) after 30-plus years, how will my benefits and insurance be affected?

A. They won’t be affected.

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Discontinued service retirement

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Q. I’m 60 with 24½ years of service. I was gone on detail and my position was filled with a permanent employee. So we are now both in the same position on the org charts. They are having me do the work no one wants to do, like a directives project that was due in 2009. I have been waiting for a buyout, but can they offer me a discontinued service out and are there any benefits?

A. No, they can’t. The only way you’d be eligible for a discontinued service retirement is if your agency officially proposed to separate you, either for poor performance or through such action as the elimination of your position.

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Disability

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Q. I have been on Department of Labor/Office of Workers’ Compensation Program for approximately 15 years due to an on-the-job injury. It does not look like I will ever return to work. What are my options? And where can I find answers about my situation?

A. If you don’t recover from your disability, your OWCP payments will continue for the rest of your life. If you also applied for disability retirement when you applied for OWCP benefits, you could, of course, drop those benefits and become a disability retiree. However, before you did that, you’d want to be sure that wouldn’t experience a drop in income. For more information about the relationship between disability retirement and OWCP benefits, go to www.opm.gov/retire/pubs/handbook/C102.pdf.

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Benefits leaving federal work after nine years

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Q. I have an opportunity to take a private-sector position that would be very rewarding. Can I maintain my federal government benefits when I leave? I’ve been a federal employee for nine years.

A. If you don’t ask for a refund of your retirement contributions, you’d be eligible for a deferred annuity at age 62.

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Postal Service retirement

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Q. I will be 60 years old in December and have worked for the U.S. Postal Service 24 years. The Postal Service is cutting back. If I wanted, could I or resign and defer retirement at a later date without losing accumulated benefits?

A. Because you are 60 and have at least 20 years of service, you can retire on an immediate, unreduced annuity any time you want.

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Medicare

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Q. My wife retired on disability 2½ years ago after 26 years of federal service because of dementia. She has other health issues. Recently, we received a letter and a “Welcome to Medicare” brochure. We are very happy with Blue Cross/Blue Shield of Florida. Can she refuse to go on Medicare? And what is are advantages of going on Medicare?

A. There are no arguments in favor of turning down Medicare Part A. She already paid for it through payroll deductions while working. You need to look at her Federal Employees Health Benefits brochure to see what the effect would be if she didn’t enroll. Because she’ll have to pay premiums to enroll in Part B, before signing up for that, you’ll need to compare the costs and benefits of doing so.

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RIF

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Q. I am a Postal Service employee involved in a reduction in force. Could I transfer to a permanent part-time position with the Transportation Security Administration and maintain my current retirement benefits as a civil service employee?

A. Yes.

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Military buyback

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Q. I am retired military with 24 total years of service (seven years active duty and 17 in the Air National Guard). I work in the civil service corps of the federal government, 21 years. In three years at age 60, I will start receiving my military retirement checks. If I buy back my seven years of active-duty time, will that void my military retirement pay and benefits? If I decide to buy back only four years, retaining 20 years of military service, will I lose any retirement benefits?

A. If you make a deposit for your active duty-service, it won’t have any effect on your military benefits. However, you’ll have to make a deposit for all of your active-duty service, unless it occurred at separate times during your career — for example, two years followed by a break and then five years. In that case, you could make a deposit for either period or both.

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Updating personnel file

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Q. When I was employed by the post office, I got my veterans preference points. Now I receive 40 percent disability from VA. Is there any benefit in notifying my personnel office of this?

A. It makes sense to have that information in your official personnel file; however, it won’t affect your benefits.

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Re-employment and high-3

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Q. I worked for a member of Congress for a little more than six years ending 12 years ago. Because he lost the next election, I became vested and eligible to receive a small pension but no health insurance (less than 10 years of service). Although I am over 62, I have never requested of collected any retirement benefits. Now I have an opportunity to go back to work for a federal agency at the GS-15 level. I assume that the benefits and time would be additive in some way, but how long would I have to work for my high-3 to be based on the higher salary? I have heard it could take five years. At what point would the retirement health insurance be locked in?

A. Your high-3 is always the highest three consecutive years of average salary. Because you are already 62 and can retire with as little as five years of service, which you already have, you would only need to work for three years to establish a new, higher high-3.

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Break in service

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Q. I was hired by the U.S. Bankruptcy Court in 1994 and resigned in 2000 to relocate across the country. Four months later, I found a new position and have been continuously employed with the federal government  since. My position in the U.S. Senate will expire at the end of the year (the senator I work for is retiring). If it takes, hypothetically, two or three months after that to find another federal position, what will that break in service do to my retirement benefits/years in service? And what about the first break in service of four months back in 2000?

A. Unless you were a bankruptcy judge, your service in the U.S. Bankruptcy Court isn’t considered creditable. If you had retirement deductions taken from your pay while you were an employee of the Senate, that service is. Assuming that you don’t take a refund of your retirement contributions when you leave the Senate, you’ll get full credit for that time when you are hired into another federal job.

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Leaving government and returning

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Q. My wife may have an opportunity for a position overseas (nongovernment) for a three- to four-year appointment. I work in a specialized field at the National Institutes of Health, so a government position in my field would be unlikely.

If we were to move, what steps could I take to either come back to work at NIH or at least keep my GS status.  I have 10 years in and don’t want to lose any benefits. A government job overseas might be possible, just not in my field, and I would definitely want to come back to NIH when we return to area.

A. If you want to return to work for NIH, you’d have to work that out with your agency. However, because this is something you want to do, not your agency, they would have no obligation to agree. Even if they did, times change; so there’s no absolute guarantee that an agreement made in good faith at the time you left would be honored three or four years later. Budgets, staffing levels, mission focus and changes in management could adversely affect that.

Leaving government would have no effect on your GS status or future benefits if you were to return to work for the federal government. However, if you didn’t return to work for NIH, as hoped, you’d have to find a job on your own.

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Re-enrolling in FEHB

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Q. If I were to resign from my current position at age 59 with 17 years of service and accept a position with a parish/county government, will I be able to re-enroll in the Federal Employees Health Benefits program when I apply for my retirement benefits at age 62?

A. No. Deferred retirees cannot re-enroll in FEHB.

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Social Security confusion

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Q. I am receiving Social Security benefits. I am still a federal employee under FERS and having Social Security deducted from my pay. I get a statement from the Social Security Administration for the amount I received for taxes, but it does not acknowledge the amount deducted from my salary as being against the amount received. I called them, and they don’t know if it could be deducted or not. The IRS doesn’t seem to know either. Do you know?

A. There is no reason why the statement of benefits you received would include any information about the deductions taken from your pay. The benefits statement is just that: a statement of the benefits you received in a calendar year. On the other hand, your W-2 shows, among other things, the total amount of Social Security deductions taken from your salary during a calendar year. If you are a relatively new Social Security beneficiary, you have a surprise coming. After you have filed your federal taxes, the Social Security Administration will update your record and send you a catch-up payment for the amount of Social Security benefit they would have paid you had the correction been made at the beginning of the new year, plus a statement of what your new monthly benefit will be. I know because it happens to me every year.

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Military to federal service

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Q. I served in the Navy from 1973 to 1982 and received an honorable discharge. Also, I received 10 percent disability. I am considering entering federal service this year. Will my active-duty time count for benefits (vacation, retirement, etc.)?

A. The Office of Personnel Management’s Vets Guide is the definitive source of information about the benefits available to members of the military who join the civilian federal government. Go to www.opm.gov/StaffingPortal/Vetguide.asp and scroll down to Service Credit.

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