CSRS retirement money payback

Q: I worked for the government, from 1974 to 1979, and when I left I withdrew my CSRS retirement money. I returned to the government in 1982 and plan on retiring with 35 years (CSRS) of service in July 2011. For those five years, if I do not repay the retirement money, can you tell me how much I will be penalized? I did not understand your response from the article ‘CSRS retirement money payback,’ dated Dec. 13, which read: If you make a deposit, your annuity when you retire will be increased by approximately 30 percent (2 percent times each year of service over 10). To me, it looks like I will be penalized 10 percent of my annuity for those five years, if I do not make a repayment to my retirement.

A: Because you took a refund of your retirement contributions before March 1, 1991, you’ll get credit for that time in determining your total years of service. However, if you don’t redeposit that money, plus accrued interest, your annuity will be actuarially reduced based on the amount you owe and your age on the day you retire. To learn more about what you would owe and how not repaying it would affect your annuity, use the handy software at www.FEDbens.us.