Q: I have 28½ years in as a federal employee under the Civil Service Retirement System. I have more than 2,400 hours of sick leave built up. I turned 61 years old in May. I have enough credits working in the private sector to qualify for Social Security when I turn 62 in 2009. Will the sick time apply toward my 30 years, and if I decide to draw Social Security at 62, how much will it affect my CSRS annuity or the deductions from my Social Security? If I decide to retire and decide to get a part time job, how much could I earn during the year without affecting either retirement? Also are there any taxes taken out on monthly civil service retirement checks?
A: If you are asking if your hours of unused sick leave can be added to your years and months of actual service to make you eligible to retire, the answer is no. If you are asking if your hours of unused sick leave will be added to your years and months of service when you are eligible to retire and used in the computation of your annuity, the answer is yes. Because you are employed under a retirement system where you didn’t pay Social Security taxes, when you apply for a Social Security benefit that benefit will be affected by the windfall elimination provision. The WEP will reduce but not eliminate that benefit if you have fewer than 30 years of substantial earnings under Social Security. Whether you will be affected by the Social Security earnings limit depends in part on when you retire. If you retire part way through a year, it’s unlikely to have any affect on what you earn. However, in all succeeding years, you’ll be subject to the earnings limit. In 2008 that limit is $13,560 for all those who are under full retirement age.
— Reg Jones
