Q: I plan to retire in December of 2011. If I retire Dec. 31, I will have 41 years and 10 months, one month shy of the 41 years and 11 months to be eligible for the 80 percent of my high-3 salary. I will have one month of sick leave. When my annuity is calculated and my sick leave added in, will I actually have the 80 percent I’m looking for? If I retire on Dec. 2 in the 24th pay period would I most likely receive my annual leave sum payment in pp. 26 which would actually be applied to the 2012 taxes, as the leave year for pay purposes usually ends with pp. 25.
A: One hundred and seventy-four hours of unused sick leave equals one month. If you have that added to your 41 years and 10 months of actual service, you would receive an annuity equal to a hair over 80 percent of your high-3. Your lump-sum payment for unused annual leave will be taxable in the year it is received. When you receive it will depend on how soon your retirement papers are cleared through your personnel and finance offices and the Department of the Treasury’s schedule for making payments.