By Reg Jones
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
Limits to federal reemployment
November 10th, 2009 | Uncategorized
Q: I am a retired Civil Service Retirement System annuitant who is currently employed in the private sector. Due to the economic downturn, I am going to have to work longer than I had planned and have been tentatively offered a job with the government. I know that previously, if I returned to work for the government, my salary would be reduced by the amount of my annuity, i.e., I would only draw a salary for the difference. I saw an article that indicated this might be changing with the new Defense Authorization Bill that the president was expected to sign last week. Can you tell me what the new rules for rehiring are under this bill, and has it been signed into law?
A: The extension of the Defense Department authority to other departments and agencies was signed by the president and is now law. However, it isn’t an open invitation to agencies to rehire annuitants on a part-time basis and allow them to receive both their full annuity and the salary of their new position. It is reserved for positions that fulfill functions critical to the mission of the agency (or of one of its components) or to support specific activities outlined in the law. Reemployment is further limited to 520 hours in any six-month period or 1,040 hours in a 12-month period. The lifetime limit is 3,120 hours.
— Reg Jones
Tags: annuitant, annuity, civil, Civil Service Retirement System, DoD, downturn, longer, reduction, salary