Ask The Experts: Retirement

By Reg Jones

Pre-MRA retirement annuity, and where sick leave goes

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Q. I am 51 and was born in 1961. I work in FERS. My MRA, I believe, is 56. I have 28 years in federal service. Will I get an annuity if I retire now before my MRA? If I do get an annuity, how big a reduction will it be from the pension I would get if I retired at 56?

Also, I have seven months of sick leave. Do I lose it all when I retire, or does it get applied as service credit?

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SRS and earnings limit

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Q. I can retire in June 2014 at 60 with 26 years in FERS. As it will be in June, I will have made more than the $15,000-plus earnings limit. If I max out my TSP contribution (approximately $11,000 for six months), my net working income will drop so I can get under the $15,000-plus earnings limit; will my special retirement supplement the following year be unreduced?

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Military and law enforcement service and retirement

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Q. I am a veteran with six years of active-duty service, and I am employed as a federal law enforcement official with seven years of service under FERS. I am considering leaving federal service. Am I eligible for any retirement benefits after age 62, or do I simply lose the 13 years that I have in military and civilian service?

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Special retirement supplement and Social Security

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Q. I am looking at retiring next year in FERS as a federal firefighter with 30 years of service at age 53. I will receive the special retirement supplement. Until I turn 62, I will not be (possibly) paying into Social Security, so does that reduce the amount of Social Security I will receive according to my current projected Social Security payments at age 62? If I’m not paying into Social Security during the period before drawing Social Security affects the rate, does that change at age 57 when the earning limitations for Social Security hit even though you are not paying into Social Security? Or is my Social Security statement set due to my firefighter retirement? Lastly, my TSP funds will be taxed as I receive payments as they were tax-deferred, but will they count against the earning limitations for Social Security? Will it make a difference if I purchase an annuity, roll it to another fund or just take a regular monthly payment from TSP in regard to how it relates to Social Security?

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FERS and cashing out annual leave

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Q. Recent legislation entitles FERS-eligible employees to have sick leave credited to their time in service: 50 percent until 2013 and 100 percent in 2014. At the same time, FERS annual leave hours past 240 are not lost but paid in full in completing your last year of employment.

Can you clarify that if you retire Jan. 1, 2014, you lose the hours in excess of 240? (I was informed by an HR employee that if you don’t retire Dec. 31, your hours in excess of 240 are not paid even if you retire the next day, Jan. 1 — I have my doubts.)

But if you didn’t and retired Dec. 31, you would lose 50 percent of your sick leave.

I have four months of accrued sick leave, whereas I would have about $20,000 in unused annual leave paid if I retired Jan. 1.

If the information from HR is true, I would have to choose between losing 50 percent of my 700 hours of accrued sick leave for retiring before Jan. 1, 2014, and losing more than 240 hours.

What is the better financial decision? Accruing four months of time in service and losing all my leave in excess of 240 or taking the full lump sum and getting credit for only two months?

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Service computation date and FERS retirement

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Q. I am contemplating retirement with a separation date of Jan. 6, 2014. Under FERS, my creditable service for retirement (on Jan. 6, 2014) will be 29 years and two months (service computation date of Oct. 24 1984). My creditable service for RIF and leave (on Jan. 6, 2014) will be 31 years and seven months (service computation date of June 20, 1982). The estimate I have indicates the MRA+10 provision, reducing my annuity by approximately 35 percent (5 percent each year under 62; I will be 57 in January). From an eligibility standpoint, which would be the correct creditable service date to use? I understand the annuity formula (1 percent x high 3, etc); if I have at least 30 years of service and have reached MRA, why such a huge penalty when the annuity is already based on the years I was able to contribute to the annuity portion of FERS?

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Special retirement supplement withholding

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Q. I am receiving the FERS special retirement supplement, and there is a withholding due to my 2012 earnings. In April 2014, I turn 62 and the supplement ends. How with the withholding due to my 2013 earnings affect my retirement benefit at that time?

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Leave without pay and creditable service

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Q. In 2011, I left my civil service job for 175 days to deploy to Afghanistan as an active-duty officer. While deployed, I used a day or two of annual or military leave every pay period to pay for my health care benefits. FERS payments also were made on the days I was on paid leave.

When I got back from my deployment, I was told I had to buy back the time, and I put in paperwork with DFAS to do so. However, I just read in my agency’s furlough FAQ that: The amount of a CSRS or FERS annuity paid by the Office of Personnel Management (OPM) is based primarily on the amount of creditable service an employee performs and the employee’s high-3 average salary.

Both CSRS and FERS allow service credit for up to 6 months of nonpay status in any calendar year. If a furlough period does not cause an employee to be in a nonpay status for more than 6 months in a calendar year, the furlough period will be included as creditable service in determining the employee’s total creditable service used in the annuity computation. If the total amount of time an employee spends in a nonpay status in a calendar year exceeds 6 months, the amount of nonpay status in excess of 6 months in the calendar year will not be creditable for retirement purposes.

Based upon this, it looks like as long as I was not in a nonpay status for six months that calendar year, I do not have to buy back that time for it to count toward my retirement. Am I correct in my interpretation of this? If so, is there a way to verify how many creditable years I have?

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Living overseas and health care

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Q. I am in the GS, age 64. I hit seven years overseas and am on the Priority Placement Program to return to the U.S. Instead, I plan to stay overseas and marry a local national. My options are to retire at 13 years’ service or to resign and take a Non-Appropriated Fund job on base to continue earning FERS coverage. I understand that next year I must enroll in Medicare Part A, although I will be overseas and unable to use it. Is there any benefit to me also enrolling in Part B if I plan to retire overseas? I have the Foreign Service Benefit Plan.

It appears that I am going to be undercovered either way unless I am still able to work on base as NAF and access the U.S. hospital where Medicare coverage would be primary. Do you have any advice on how to retire overseas regarding health care benefits? It seems there is no good answer, and yet I know many people who are not military retirees making the decision to stay overseas after their tours end.

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Service academy attendance and leave accrual credit

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Q. I’m confused about receiving service academy credit toward leave accrual for retired military members. The personnel servicing agency has denied request for credit based on Title 5 and 38. Title 5 of US Code 6303 states, “An employee who is a retired member of a uniformed service as defined by section 3501 of this title is entitled to credit for active military service only if — (A) his retirement was based on disability — (i) resulting from injury or disease received in line of duty as a direct result of armed conflict; or (ii) caused by an instrumentality of war and incurred in line of duty during a period of war as defined by sections 101 and 1101 of title 38.” The US Air Force Academy time cannot be considered for people who retired from active duty.

It makes sense that the military time should not be double-counted toward government retirements except in exceptional situations. However, the service academy time is not creditable toward military retirement and should not be held to the standard set under Title 5 section 6303. Is the personnel servicing agency correct that the time is not creditable for leave accrual even though the service academy time is creditable toward retirement in FERS?

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Disability annuity and continued federal employment

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Q. Since I started receiving a FERS disability annuity, I have worked while still receiving the annuity. What percent of my federal service salary can I earn without losing my annuity? (It was 60 percent or so.)

I was a GS-855-12 step 2. What is the current salary for that position (GS schedules are easy to find, but not GS-855 salary schedules showing their higher rates of pay)?

Do I still lose my disability annuity if I return to work for the federal government as a teacher at an overseas military base? (It used to be that returning to work for the federal government would automatically end the disability annuity.)

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Reduction in force and retirement

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Q. I will be 58 next year, when we are supposed to be RIF with the Postal Service if we have not found another EAS position. At that time I will have 24½ years in and be 58. I understand I will be eligible for DSR.

How is the amount calculated? Is it the same as the FERS amount, is it permanent and can I still receive the FERS supplement? Can I receive DSR and FERS, or just the DSR or FERS? I don’t want to retire but am trying to see how I will be financially if I am part of an RIF. Also, does this affect my Social Security?

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FERS retirement and leave

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Q. I am a FERS employee and was hired in January 1984. I will reach MRA (56) with 31½ years of service in early July 2015.

What is the best day for me to retire in 2015 to get credit for the most annual and sick leave?

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Special retirement supplement

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Q. I took a job last year. After reporting my earnings to OPM this year, I will not be receiving a FERS Social Security supplement in the future.

What happens to the money? Do I simply lose the funds? Does this increase my future Social Security payments?

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FERS retirement options

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Q. I have some vague idea that some benefits are linked to completing 10 years of federal service, but I can’t find details or facts.

I’m under FERS, have a service computation date of 2004, have worked full time since 2007 and worked TERM appointment 2004-2007.

I thought I would last until 2014. However my elder parent and young grandchild could both use my service and time, and thus I am considering leaving before my 2014 date and working from home in a nonfederal job.

How would that affect my benefits — just resigning before 10 years? I’m only 55 and won’t be submitting for retirement benefits until 63 or later.

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Benefits for retiring at 65 with 29 years

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Q. I’m a FERS employee thinking of retiring at the end of 2014.

I’ll be 65, and with time served, military and sick leave (barring any lengthy illness between now and then), I’ll have 29 years, plus a couple of months. I know I’ll be losing some benefits from Social Security, leaving a year early, but what would the loss be from leaving before the 30-year mark?

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Unscheduled hours, official hour of duty and annuity

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Q. I am a FERS employee who will retire in 2016 under the 20 years by age 60 rule. I went part time in 2010, with my official tour being 20 hours per week (40 per pay period); however, I usually work 24-30 hours per week due to clinic needs. I get paid for these unscheduled hours. I know my annuity will be prorated to account for my part-time work during my career; however, will the part-time portion be calculated using my official tour of 40 hours per pay period, or will the part-time calculations use the actual number of hours I worked?

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Military reserve service, civilian service and FERS

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Q. I am currently a GS-12 at U.S. Southern Command. I served 31 years in the Army National Guard, U.S. Army Reserve, and was called to active duty on and off for around 7½ years. I bought back most of this Army Reserve active-duty time, and the amount just showed up today in block 20 of my civilian leave and earnings statement (military deposit paid). This is the first time in my Army career where I see that a reservist has it over an active-duty soldier in that he doesn’t have to combine his retirement with a civilian retirement.

However, yesterday, the Army Benefits Center-Civilian called me at work and said it is shredding my FERS retirement packet! Months ago, when I began the military deposit process, I was told by two ABC-C retirement counselors that I could buy my years of active military service in the Reserve and add to my three-plus years of federal civilian service to qualify for a small FERS retirement annuity in that I’m older than 62 and would then have far more than five years of creditable service.

The counselor who shredded my packet told me there are a lot of “new people” at ABC-C and I was misinformed. So now, instead of retiring, I’m resigning very soon for a variety of reasons (one being that I’m one of three candidates selected for a GS-13 position in my “home state” but am on hold due to the hiring freeze).

What form do I fill out, and where do I mail it to reclaim my funds?

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FERS, military service and civilian status

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Q. 1. I am a FERS employee with seven years service with the VA (and three years bought back from active duty 1973-1976) totaling 10 years of federal government time. I started at the VA in Tampa on Feb. 21, 2006, at age 54. I was born on Feb. 6, 1952. Is my calculated retirement date Feb. 21, 2003? I had worked six months with the VA until the Army activated me from Aug. 29, 2006, to Aug. 28, 2007. I returned to the VA for six to seven months until March 30, 2008, when I was activated again with the Army for three years with no break in military service until I officially retired from Army Reserve on March 22, 2011. All of my active-duty time has been bought back while on military leave without pay; all SF-50s were coded correctly. I am now 61 and was looking to leave the federal government for a civilian job.

HR is telling me I do not qualify for MRA+10 because I have not worked a “total of five years with the VA in a ‘civilian’ status.” Is this correct? I thought that buying back the time counted toward retirement.

I am being told by HR that I need to wait until February 2015 to officially retire and begin drawing on my retirement. If I chose to leave the VA before then, I am being told that I would not be eligible for retirement pay but rather be paid a “lump sum payout or annuity”? Is this correct? What does the annuity look like? Is it only what I have contributed over the past seven years? Does it include what the federal government provides in the matching 5 percent?

2. How can I see what is in my retirement bucket? The VA does not have the EBIS system to keep eyes on retirement monies, etc.

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Military leave without pay and retirement

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Q. I was hired as federal civilian Feb. 21, 2006. I was called to active duty August 2006-2007.

I went back to my civilian job from August 2007 until the end of March 2008 and was then called back to active duty through March 2011. I returned to civilian service and have been there since the end of June 2011.

I want to retire under the optional five-year retirement. I was on military leave without pay during all my active duty and paid into FERS when I returned to federal service. Is my time on military LWOP creditable toward the five-year civilian service requirement?

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