Ask The Experts: Retirement

By Reg Jones

FEHB, remarriage and spouse equity

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Q. If a federal government employee gets divorced before retiring and his ex-spouse is covered by FEHB under Spouse Equity, and after retiring the former employee remarries, is he allowed to cover his new spouse under FEHB? In other words, does the fact that his ex-spouse is cover under FEHB by Spouse Equity prevent the former employee from covering his new spouse under FEHB in retirement? On a similar note, what if he divorces after retirement, his ex-spouse is covered by Spouse Equity and then he remarries? Is the new spouse eligible to be covered under the retiree’s FEHB?

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CSRS offset and not collecting Social Security

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Q. I am under CSRS offset. I am going to retire in three years at age 62. I know my government pension will be reduced by $213 when I turn 62. According to my Social Security statement, I should receive $888 if I collect at age 62. It states: “At your current earnings rate, if you continue working until 66, you will receive $1,366 a month.” What happens if I don’t collect Social Security at age 62 and wait until full retirement age? Will I receive $1,366 a month minus the $213 offset reduction, minus the windfall elimination provision? (I will have only 20 years under Social Security.) Or will the $1,366 be recalculated since I won’t be paying Social Security from age 62 to age 66? Also, I am divorced and not remarried. My ex-spouse is retired military and under FERS. He has remarried, but I am still entitled to his Survivor Benefit Plan under his military retirement plan. If something happens to him and I start receiving SBP, will my Social Security be affected?

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Divorce, remarriage and survivor annuity

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Q. I worked in the civil service program for 34 years and retired in 1998. I named my wife as the survivor annuitant.

In August 2005, she and I divorced. Even though the annuity was not mentioned in the divorce documents, I did not change the designation. Now I have been residing with a significant other for more than six years.

I would like to marry this woman and name her as the annuitant for my federal retirement. With no mention of the annuity in the divorce documents, can I make this change? If so, and since I have continually made the monthly adjustment to my retirement for a survivor annuitant, can this change become effective immediately, or must we conform to the nine-month waiting period?

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Military buyback

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Q. I retired from the Air Force in 2003 after 26+ years of active service. I am divorced and split the retirement 50/50 with my ex-wife. I’m a GS employee with 10 years under FERS. Can I buy back my time? If so, would it even be beneficial to do so?

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Divorce and retirement annuity

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Q. I was divorced from a Postal Service worker in 2000 and he finally retired recently. Where do I go to get my portion of the annuity that was in the settlement?

A. You’ll have to call the Office of Personnel Management at 1-888-767-6738 or 1-724-794-2005 and talk to a benefits specialist.

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Divorce and health benefits

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Q. I have worked for the Veterans Affairs Department as a civilian for more than five years. My wife always handled the health care insurance under her company’s program, so I never took advantage of mine. We are now in our 18th month of divorce and I would like to go on my health care program under my benefits at VA. My human resources department says I need a divorce decree to be able to get coverage. My wife is about to lose her job, so I am worried that I may be without coverage. What should I do?

A. If your wife loses her coverage as a result of losing her job, you might be able to enroll in the Federal Employees Health Benefits program under Code 1M of the Office of Personnel Management’s Table of Permissible Changes in Enrollment. Check with your personnel office. If you don’t, you’d have to wait until the next open season to enroll.

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Marriage and retirement application

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Q. I am getting ready to retire in two to four years. I was divorced in 2000 and need to know what type of documentation I will need. In a Sept. 17 article, you indicated that some of the problem areas included failure to answer the court order question.”

A. When you fill out your retirement application, you’ll need to check the box under Marital Information and attach a certified copy of the court order(s) and any amendments. You’ll find that box in Section E of the SF 2801 (CSRS) and Section C of the 3107 (FERS).

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Military buyback and divorce

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Q. I retired in 1995 from the Army after 15 years and two days under the early retirement option offered. I have been working for the federal government for over 16 years. I have not bought back any military service; I draw a military pension and disability pay. I divorced my spouse in 2006; she waived all rights to my current federal annuity, Thrift Savings Plan, etc., but does receive half of my military pension and the other half as spousal maintenance outlined in the divorce decree. Would it be legal to buy back my military service credit and convert it to my current federal time? Or should I seek legal counsel on this matter? Or will Defense Finance Accounting Services deny this request because she is in receipt of half of my military pension?

A. Although we aren’t able to answer questions involving court-ordered benefits, I can tell you that you would only be able to make a deposit for your active-duty service if it didn’t result in your having to waive your military retired pay. As a rule, retired members of the military must do that. You’ll have to check with your branch of service to find out if there is something about your situation that would exempt you from that provision of law.

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Survivor, family benefits after divorce

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Q: My father passed away at age 79 on Oct. 29. He and my mother divorced Jan. 31, 1985, and she never remarried. He remarried, but his wife passed away Jan. 26, 2009. He has two adult children from his first marriage. Would his former spouse be entitled to any benefits before his children? There is no beneficiary and no court order on file.

A: She wouldn’t be entitled to any retirement benefits. Whether she would have title to any Federal Employees’ Group Life Insurance benefits would depend on who he had designated as his beneficiary.

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Survivor benefits and divorce

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Q: I retired from the U.S. Postal Service in 2000 after being divorced in 1997. I gave my ex-wife 100 percent survivor benefits; she recently turned 55. I remarried in 2004 and sent the proper forms needed to add my current wife to my Federal Employees Health Benefits plan. I now have the American Postal Workers Union (472) plan, and I assumed that if I died, my present wife would be able to keep the plan. After talking with the Office of Personnel Management, I was told that I need to have my present wife named as survivor beneficiary for her to keep it, even though my ex-wife has 100 percent survivor benefits. They said that I had to do that within two years after our marriage. I was never advised of this and have never read anything on the matter. Can you please explain this to me?

A: Under 5 CFR 831.631, a retiree can elect a survivor annuity for a spouse acquired after retirement. That election must be made within two years after the marriage. Although your former spouse has entitlement to the full survivor annuity, if she were to die and you had elected a survivor annuity for your current spouse, your current spouse would be entitled to that survivor annuity. Because your annuity has already been reduced to pay for the original survivor annuity, your election of one for your current spouse wouldn’t cost you anything. Note: Even if you died after electing a survivor annuity for your current spouse, she would only be eligible to continue her FEHB coverage if she was actually receiving a survivor annuity.

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Retirement and divorce

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Q: I am a letter carrier with the Postal Service and am under CSRS. In 2006 I received a divorce and as part of the settlement my ex-wife will receive a portion of my retirement. I became eligible to retire at the end of 2008 when I reached 55 years of age. However, for financial reasons I cannot afford to retire at this time. Can my ex receive her share of my retirement now even though I continue to work and am not retired?

A: As a rule, we’re not qualified to answer questions about divorce; however, I can tell you that your ex-wife won’t be eligible for a portion of your retirement annuity until you retire.

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Survivor annuity and second marriages

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Q: If an widow is receiving survivor benefits through the Civil Service Retirement System and she remarries, do her benefits stop?

A: Yes, if she remarries before age 55. However, if that marriage ends in annulment or divorce, the survivor annuity can be reinstated.

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WEP, Social Security and an ex-spouse

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Q: My husband recently turned 62 and applied for Social Security benefits. He is a previous Civil Service Retirement System employee, so we know that his Social Security benefit will be reduced. The problem is that he was previously married and must pay his ex-spouse a large portion of his CSRS retirement. Yet when his retirement income from CSRS was taken into account in order to offset his benefits, the Social Security Administration used his gross benefit amount and did not subtract the annuity for his former spouse. This reduced his benefits by a large portion.

Why is it that the Social Security office will use his gross amount when even the Internal Revenue Service uses his gross amount minus his former spouse’s annunity to calculate his taxes? Somehow this doesn’t seem right.

A: The windfall elimination provision reduces the Social Security benefit of anyone who receives an annuity, in whole or part, from a retirement system into which he didn’t pay Social Security taxes and has fewer than 30 years of substantial earnings under Social Security. CSRS is such a retirement system. Whether he receives his entire annuity or has it reduced by electing a survivor annuity, or must pay it to someone else because of a court order, has no effect on the legal requirement that his Social Security benefit be reduced.

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Divorce and annuity

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Q: Is there a place at the Office of Personnel Management where I can forward a copy of my divorce decree and request an estimate of how much of my annuity will go to my former spouse? I have the retirement estimate from my human resources office and can provide them an amount of my total annuity.

A: You can forward your divorce decree to the Office of Personnel Management, Retirement and Benefits Service, Court Orders Section, 1900 E Street, NW, Washington, DC, 20415. However, OPM won’t provide you with an estimate.

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The effect of remarrying on annuities

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Q: I have a friend who retired from the Civil Service Retirement System in 2002 and was divorced at the time. His ex-wife will not receive a survivor annuity per his divorce decree. He is going to get remarried this summer and will elect full survivor annuity for his new wife. He knows his monthly annuity will be reduced but he is curious to know if the reduction would be the same as if he had been married all these years, or will there be an additional amount deducted to make up for the years since he retired?  I hope I am making sense because it took me a while to figure out what he was asking.

A: If your retired friend marries and elects to provide a survivor for his wife, there will be two reductions in his annuity. The first will be to provide the survivor benefit. This will be the same reduction that would have occurred if he had elected a survivor annuity for a current spouse when he retired. The second reduction will be a permanent actuarial reduction. This will require a deposit that equals the difference between the new annuity rate and the annuity paid to him for each month since he retired, plus six percent interest. The reduction is calculated by dividing the amount of the deposit by an actuarial factor based on his age on the day his annuity is reduced to provide the survivor benefit. Note: As a CSRS retiree, he has the option of electing a survivor annuity that ranges between $1 per year and 55 percent of his unreduced annuity.

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