Q: My 59-year-old husband was a GS-6 from 1974-1982. He was otherwise employed for 40 quarters but at very low pay. His estimated CSRS annuity is $197 and his Social Security Statement says his benefit at age 62 is $365. My understanding of GPO and WEP is that his CSRS annuity is reduced (eliminated) by his Social Security annuity, and even if there is a floor for the reduction, his Social Security annuity is then reduced $2 for every $3 of the CSRS annuity. I am 52, retired active duty, and a FERS GS-13. I intend to work until 2029 to get 25 years of FERS and maximize my Social Security annuity. As long as I am alive, we do not need the small amounts he could get from his CSRS and Social Security annuity. However, if I die first, he would need spousal Social Security annuity based on my earnings to survive. If he takes out only his contributions to CSRS or doesn’t apply for that annuity at all, will this protect his spousal Social Security annuity based on my earnings from WEP?
A: First, let me correct a few misunderstandings. He would be subject to the windfall elimination provision (WEP) because he’d be receiving an annuity from a retirement system where he didn’t pay Social Security taxes. The WEP would reduce but not eliminate his Social Security benefit. He’d also be subject to the government pension offset (GPO), which would reduce his spousal Social Security benefit by $2 for every $3 he received in his CSRS annuity.
While refusing to apply for a CSRS annuity wouldn’t make any sense, asking for a refund of his retirement contributions might. It largely depends on the results of a comparison between what he would receive if he received a CSRS annuity and what he’d get if he didn’t get that annuity but relied of your spousal Social Security benefit. There is software available at www.FEDbens.us that can help you estimate what the end result would be.