Q. I have 12 years of service as a foreign service officer under the Foreign Service Pension System. If I leave the government, can I withdraw my retirement contributions and my agency’s contribution? Are there reinvestment requirements or tax implications?
A. You can withdraw your retirement contributions, but not those you agency made. The latter were put there to fund your retirement, not your bank account. When refunded to you, the contributions will be tax-free because you already paid taxes on them; however, any interest you receive will be taxable as ordinary income.
