FERS annuity supplement


Q. For most employees, the FERS Annuity Supplement is not actually payable in the year after they retire.  If you retire at the end of a year from a full-time position, your earnings  for that year will mostly likely fail the earnings test so the annuity supplement is reduced to zero.  So at best, you have to wait at least one year after retirement to get the supplement.  Is this true?  It doesn’t seem fair to me, but I have a few years in which I can prepare for that one-year wait if it is true.  Any earnings you have during the year after you retire and every year thereafter is subject to the earnings test to see if you can start or keep receiving the supplement.

A. First you make a flat assertion; then you ask me if it’s true. Well, it isn’t. None of the earnings up to the day on which you retire are subject to the earnings test. Under the “first year” rule, only earnings during the months after your retirement are counted. Further, if you retired at the end of December, none of the earnings during that year would  be used, only those earnings from January forward would be subject to the limit. For more information, go to www.socialsecurity.gov/pubs/10069.html#special, and read the section on “Special rules for the first year you retire.”


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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to fedexperts@federaltimes.com.

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