By Reg Jones
Spousal Social Security benefits
February 16th, 2010 | Uncategorized
Q: My wife died last year. She was a retired educator with more than 30 years of service. She turned 60 in December 2009. She also had been receiving Social Security disability for almost two years before she died. I will be turning 61 in 2010; however I am still working with more than 30 years of federal service under CSRS. I am an outset employee because I left the federal government for two years and have been back since Jan. 6, 2009.
Can I received her Social Security at age 62 and delay drawing mine until I am 65? If so, will it reduce my amount at age 65? I am also a substantial contributor from the military with 37 years of service in the National Guard and will not be subject to offset.
A: If you were age 62 and still working, you would be eligible to receive an unreduced spousal Social Security benefit. On the other hand, if you had retired, that benefit would be reduced by $2 for every $3 you received in your CSRS annuity. Further, because you are covered by CSRS Offset, if you are retired and eligible for a Social Security benefit at age 62, your CSRS annuity would be offset by the amount of Social Security benefit you earned while covered by CSRS Offset. If you retired after age 62, the reduction would occur on the day you retired. The reduction would occur whether or not you applied for a Social Security benefit.
Tags: Offset, retirement, social security
Social Security survivor benefits
February 11th, 2010 | Uncategorized
Q: I am retiring soon under the Federal Employees Retirement System and my spouse is already retired under the Civil Service Retirement System. Should I die before her, will she be able to collect unreduced Social Security survivor’s benefits?
A: No, she won’t. Her survivor benefit will be subject to the government pension offset provision of the law, which will reduce that benefit by $2 for every $3 she receives in her CSRS annuity.
Tags: annuity, CSRS, FERS, Offset, social security, spouse, surviving spouse
Federal re-employment
February 11th, 2010 | Uncategorized
Q: I recently retired at age 56, air traffic control mandatory retirement, with 36 years in the Civil Service Retirement System. A desirable position for which I am qualified has become available with a local Transportation Security Administration unit. If rehired at TSA, would I be under the Federal Employees Retirement System or CSRS? If I’m under FERS, could I retain full CSRS annuity? If rehired into CSRS, what are some factors to consider: annual leave rate, recomputation of CSRS annuity, etc.? I would like to work until age 62, when my wife can retire and would be very close to maximum CSRS annuity (80 percent).
A: If you were rehired anywhere in the federal government, your annuity would continue, and, in most cases, the salary of your new position would be offset by the amount of your annuity. You would have the option of electing to be covered by FERS. You wouldn’t be starting anew if you did, you would simply be continuing your federal employment under another retirement system. Whatever you decide to do, if you worked for one year you would be eligible for a supplemental annuity. If you worked for five years, you’d be eligible for a redetermined annuity. Whether this would be to your advantage financially if you had switched to FERS is something you’d have to explore with your new personnel office. On the other hand, if you stayed under CSRS and worked for a total of 41 years and 11 months, your annuity would equal the maximum 80 percent annuity available under CSRS.
Taxable earnings for CSRS Offset
February 9th, 2010 | Uncategorized
Q: In your Jan. 25 article “New year, same COLA,” you say that the Social Security withholding stays at $106,800, and that “if you are a Federal Employees Retirement System or Civil Service Retirement System Offset employee, any amount you earn above that amount won’t be subject to the 6.2 percent Social Security deduction.”
However, I am a GS-810-14, Step 10, Forest Service employee under CSRS Offset and the National Finance Center withholds Social Security from my paycheck for the entire year. Withholding from my paycheck doesn’t cease at the $106,800 limit. This seems contradictory to what the article states. Can you please explain?
A: According to the Office of Personnel Management, when the total basic pay paid in a calendar year reaches the Social Security maximum taxable wage base, the deduction rate reverts to the “full” CSRS employee withholding rate. Agencies must ensure that the deductions on the first dollar of basic salary paid to CSRS Offset employees over the Social Security wage base are made at the full CSRS rate and that the reversion to full withholding is reflected during the pay period in which it occurs. While the place that the deductions go — Social Security or OPM — will change, the amount that’s deducted stays the same. That’s because most CSRS Offset employees contribute 0.8 percent to CSRS and 6.2 percent to Social Security, for a total of 7 percent. When the wage base is exceeded, 7 percent is paid to CSRS.
Tags: civil service, CSRS, Offset, retirement, social security
DoD guidance applies for rehired annuitant
January 18th, 2010 | Uncategorized
Q: Please clarify/elaborate on your response concerning a lifetime limit of 3,120 hours for rehired annuitants working without an offset in annuity payments. I am employed by the Defense Intelligence Agency, under the Federal Employees Retirement System as a contract specialist (GG-1102). DIA’s human resources department has informed me that I can continue to work as a rehired annuitant for up to five years without any offset in my annuity. I have had this same information provided by the Air Force human resources department. Is there a special exemption for GG-1102 positions, given that there is an accurate shortage of experienced GG-1102 personnel and the lengthy time it takes to become proficient in this career field? My “lifetime limit of 3,120 hours” will reached in March 2010, and I don’t want to be in the position of having to repay any salary at a later date. I tried to research the answer in PL 111-94, but found it too lengthy and confusing.
A: Apparently, you were hired under a special authority granted to the Defense Department. Your personnel office has already told you how long you can remain on the rolls. The other authority to which you referred was prospective and applies only to annuitants who are hired after it was enacted.
Retired annuitant act
November 27th, 2009 | Uncategorized
Q: Has the retired annuitant act — which proposes allowing federal employees to retire and work part-time as a retired federal employee without an offset of your pension — been passed into law? Where can I find more information on this subject?
A: That provision was included in Public Law 111-84, which was signed by the president at the end of October.
Tags: Offset, pension, retired annuitant act
Offsets upon retirement
November 17th, 2009 | Uncategorized
Q. I would like a clarification. Would I receive separate payments for my Federal Employees Retirement System retirement, military retired pay, military disability and Social Security? Or will some or all potentially be offset? This is with the scenario that I do not sell back my military time and waive retired pay. Reading the below, I believe the answer is yes, but I just want to make sure for my long-range planning.
Selling back military time
Question: I am retired from the Army and receive both retired pay and disability pay. I am also a civilian employee under the Federal Employees Retirement System. When I am eligible to retire, will I be paid my military retirement pay, disability pay, retirement pay as a civilian employee and also receive my Social Security? Would it be advantageous to sell back my military time to incorporate it into my civilian time under FERS? If I do sell back my military time, do I forfeit continuance of my military retirement pay?
Answer: If you retire without making a deposit to the retirement fund and waiving receipt of your military retired pay, you would receive a FERS annuity based solely on your FERS service, your military retired pay, your disability pay and a Social Security benefit based on all your Social Security-covered employment. If you do make a deposit for that time and waive your military retired pay, you would receive a FERS annuity based on your active-duty and FERS service, your disability pay and a Social Security benefit based on all your Social Security-covered employment.
A. If you didn’t make a deposit and waive your military retired pay, you would receive separate payments with no offsets.
Who is subject to the WEP?
November 10th, 2009 | Uncategorized
Q: Your recent article on the Personal Advisor in the Nov. 2 issue of Federal Times described retirement benefits. You note that in 1983, “Those already covered by [Civil Service Retirement System] had the option of electing full coverage under both CSRS and Social Security …” However, your description doesn’t seem to recognize the Windfall Elimination Provision, such that those who elected to be covered by both get the severe reduction on their Social Security from the WEP. Is my understanding correct, or is something on WEP changed? I understand that I will get the WEP reduction on my Social Security, retiring after 30 years of service (using the military buyback) and over 40 quarters of Social Security.
A: That column was about the retirement options of members of Congress, not employees of the executive branch of government like you. Members were offered choices in 1983, one of which was to be covered by full Social Security and full CSRS. If they chose that option, they would have paid 6.2 percent to Social Security and 8 percent to CSRS. As a result, the windfall elimination provision would not have applied. Those who chose the interim system (which later became CSRS Offset) paid 6.2 percent to Social Security and 1.3 percent to CSRS. In their case, the WEP did apply.
— Reg Jones
Tags: coverage, CSRS, executive, executive branch, military buyback, Nov. 2, Offset, option, personal advisor, reduction, retirement, WEP
WEP and Social Security
November 10th, 2009 | Uncategorized
Q: My wife retired at the age of 58 with a Civil Service Retirement System annuity. If she has 40 quarters in the Social Security system before she is 62, will she be able to collect her Social Security at age 62 without a reduction in her CSRS annuity?
A: If she was covered by CSRS alone, her CSRS annuity won’t be reduced. However, her Social Security benefit will be reduced through the workings of the Windfall Elimination Provision. The WEP reduces — but doesn’t eliminate — the Social Security benefit of anyone receiving an annuity from a retirement system where he or she didn’t pay Social Security taxes. On the other hand, if your wife was covered by CSRS Offset (CSRS and Social Security), her CSRS annuity would be offset by the amount of the Social Security benefit she earned while employed under CSRS Offset.
— Reg Jones
Tags: annuity, CSRS, Offset, social security, WEP, windfall elimination provision