Q. Is any state free from federal tax on federal or military pensions? A. States having no personal income taxes include Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. Those that exempt the total amount of civil service annuities include Alabama, Illinois, Hawaii, Kansas, Louisiana, Massachusetts, Michigan, Mississippi, New York and Pennsylvania. Kentucky exempts civil service annuities only if the employee retired before Oct. 1, 1991; North Carolina only if the individual had five years of creditable government service as of Aug. 12, 1989; Oregon for those who retired before Oct. 1, 1991, with only a…
Monthly Archives: November, 2012
Q. I am a FERS employee who plans to retire at the end of 2013. At that time, I hope to have around 448 hours of annual leave (240 hours carried over from 2012). What is the best date for me to retire without losing any annual leave? I will be 65 on Nov. 10, 2013. A. Before I get to your question, let me remind you that if you retire before Jan. 1, 2014, you’ll only get half credit for any of your unused sick leave. With that out of the way, you can retire on any day up…
Q. With the possibility of reductions in force in the Department of Justice starting in February, what are law enforcement’s early retirement options (VERA)? I am 58 with only 15 years’ law enforcement and 19 years’ government service. Will I get any credit for law enforcement years? A. Although you are age 58, you only have 19 years of service; therefore, you wouldn’t be eligible to retire under the Voluntary Early Retirement Authority. However, you would be able to retire under the MRA+10 provision (minimum retirement age with between 10 and 29 years of service). If you did that, your…
Q. My MRA is 56 (I was born in 1955). If I retire at age 59 with 20-plus years of service and defer my annuity until age 60, would I still receive the FERS Social Security annuity supplement until age 62, or do I actually have to wait until I reach age 60 to retire? A. If you retired at age 59 with 20-plus years of service, you’d be retiring under the MRA+10 provision. No one who retires under that provision is eligible to receive the special retirement supplement, regardless of when his annuity begins.
Q. I will be retiring soon, and I have an FEHB question. I have 27-plus years with USPS and have been in FEHB from the beginning. I’m now married and my wife has been on the plan more than 10 years. After I retire, if something happens to me, will me wife be covered as self only? I haven’t decided whether to take the survivor annuity because under FERS, she would get only $500 a month under the 50 percent selection. I might be able to buy an insurance policy that would be better. A. Unless you elect a survivor…
Q. I am 55 with 24 years, and I am in the CSRS/Offset system. I took a VSIP in 1994 but was told at the time it would not affect the calculation of my retirement when I was ready to retire. 1) How would I find out if the 1994 VSIP does affect my annuity? I received a lump sum of $14,000, and it included my retirement and annual leave. 2) Do I have to redeposit those retirement funds to receive full annuity? If I retire at 56 with 25 years, how will my retirement be penalized? 4) What is…
Q. I worked from October 1985 to April 1991 for the post office and was part-time flexible for 13 months of it. I cashed out my retirement when I left. If I took a federal job, would I be allowed to buy that time back for retirement? Also, if that job was not with the Postal Service, would this affect retirement benefits? A. If you return to work, you could redeposit that money, plus accrued interest. It doesn’t make a difference whether you work for the Postal Service or any other federal agency. They’re all under the same retirement system.
Q. I received a career appointment with USPS as a letter carrier in 1977 and resigned in 1995 with 17 years’ service. Whom do I call or email for details on my reduced pension benefits? I turned 62 in October. A. All you need to do is complete a copy of Standard Form 3107, Application for Immediate Retirement, and mail it to the address on the form. You annuity will be computed as follows: 0.01 x your highest three consecutive years of average salary x your years and full months of service.
Q. I am a 55-year-old USPS employee covered under the American Postal Workers Union health plan. If I take early retirement and work for a private-sector company, can I still carry my FEHB, or must I take any health plan offered by my new employer? A. As long as you have been continuously enrolled in the FEHB progam for five years (or from your first opportunity to enroll) you can continue that coverage after you retire. I have no idea whether your new employer will require you to enroll in its health plan. If it does, that coverage will be…
Q. I am a retired CSRS employee. I do not receive Social Security, as I have only 31 quarters paid. My husband is a retired FERS employee, as well as retired military, and receives Social Security payments. If I outlive him, will I be entitled to a portion of his Social Security? A. Probably not. Because you are receiving an annuity from CSRS, a retirement system where you didn’t pay Social Security taxes, you’ll be subject to the government pension offset. The GPO will reduce that Social Security survivor’s benefit by $2 for every $3 you receive in your CSRS…