Q: I am a 55-year old FERS employee eligible to retire as a special category FF/LEO with 27 years federal service. I have been thinking about finding a position teaching or working on the staff of a nearby university that is covered by the state retirement system (Ohio). It is my intention to work until age 65, so when I retire from the university I will be vested in their retirement system, too. The university offers a choice between a defined benefit and defined contribution plan. I have heard about things like the WEP and the Pension Offset Rule but am not certain whether either would apply in my situation. Are there negative impacts to either the federal annuity, annuity supplement or Social Security that would result from post-retirement employment with a state/local government agency?
A: Working for a nonfederal employer would have no effect on your FERS annuity or your eventual Social Security benefit. However, if your earnings from that employment exceed the Social Security annual limit, your special retirement supplement will be reduced or suspended. The limit for 2011 is $14,160. The windfall elimination provision only applies to someone who is receiving an annuity from a retirement system where he didn’t pay Social Security taxes. And the government pension offset only applies to the Social Security spousal benefit of someone who is receiving such an annuity.