Q. I worked for federal government for 20 years under CSRS, then resigned in 1997 and left my retirement contributions in CSRS, understanding that I could start to receive an annuity at age 62. Since that time, I have worked for 15 years for state government, paying into Social Security. If I were to return to federal service, into which retirement system would I be placed? What would the benefits be to returning to federal service as far as retirement benefits concerning CSRS and Social Security?
A. Because you left your contributions in the retirement fund, you would be eligible for a deferred annuity at age 60, not 62. If you returned to work for the government, you would automatically be placed in CSRS Offset (CSRS and Social Security) with the option of transferring to FERS. If you stayed in CSRS Offset, your annuity would be computed under CSRS rules, which are more generous than FERS, but your annuity would be offset by the amount of Social Security benefit you earned while covered by CSRS Offset.
Further, because you’d be receiving an annuity, in whole or part, from a retirement system where you didn’t pay Social Security taxes, your Social Security benefit would be subject to the windfall elimination provision. It reduces the Social Security benefit of anyone who has fewer than 30 years of substantial earnings under Social Security. If you elected to covered by FERS, there wouldn’t be any offset to your annuity; however, the WEP would still apply.
