Monthly Archives: January, 2013

WEP

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Q. I worked four years under CSRS and drew the retirement funds out and did not pay them back. When I was reinstated, it was under the CSRS Offset. I retired and drew the CSRS Offset but did not apply for my Social Security benefits until I reached age 66 in October. I just got notified by Social Security that I would be subject to the windfall elimination provision from my Social Security check. Is this correct? I have 29 years and three months of substantial earnings, according to their table for substantial earnings. Actually, for these years, I far…

Voluntary vs. mandatory retirement

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Q. I am eligible for retirement March 21 as a law enforcement officer under FERS. I will have 20 years of law enforcement experience and am age 56. Because I turn 57 in October (seven months later), I will be forced to retire Oct. 31. Aside from the extra approximately $8.56 per month I will get in my annuity for each month I stay after March and the benefit of having a full salaried job for seven more months, is there any advantage to me retiring under mandatory retirement age versus voluntary? The combination of my projected annuity and special…

Leave usage

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Q. I plan on retiring in the near future. I will have around 300 hours on annual leave at that time.  Is there any Office of Personnel Management guidance that discusses my option to take the leave immediately prior to retirement rather than being paid for that leave at retirement? A. There is no such thing as terminal leave in the federal civilian service. Therefore, you don’t have a choice. While you can take annual leave at such time and in such amounts as are approved by your supervisor, you can’t burn it off.  Just be happy that your unused…

401(k) rollover and military buyback

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Q. My husband has 10 years of Air Force service and is in the process of negotiating to take a federal position. To buy back his service, is it possible to use a 401(k) rollover? I am thinking not, since a rollover is only allowable to an IRA or other “qualified plan.” We certainly can take a direct taxable distribution of a portion of that 401(k) plan and use that money to buy back, but he wondered if it can be done with the rollover. A. No, it can’t.

Medicare Part B penalty

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Q. I am 68 years old and signed up for Medicare Part A before my 66th birthday. I have not signed up for Part B for several reasons. 1. My husband is 60 years old and we have insurance coverage with Federal Employee Plan Blue Cross/Blue Shield. 2. We are posted out of the country, in the Czech Republic. 3. I have no occasion here to use Medicare or incur its costs. Health costs are self-paid upfront in full and then partially reimbursed by our insurance company. I believe individuals are penalized 10 percent per year for not signing up for Medicare when…

Retirement application

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Q. I am in the process of completing my CSRS SF2801, Application For Immediate Retirement. Concerning Section B, Federal Service, block 5: “Are you receiving or have you applied for military retired pay?” I am retired from the Air National Guard and receiving monthly retirement pay. Should I answer yes to this because I am receiving retirement pay for reserve service, or does this question only apply to active-duty retirees? A. It applies only to military retired pay, not reserve retired pay.

Special retirement supplement

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Q. I am planning to retire this year at age 60 with 29.7 years of service under FERS. I understand that I will receive the annuity plus special retirement supplement. However, as a widow, I am also allowed to receive my husband’s Social Security payment at age 60. Does this reduce the special retirement supplement? Also, does the special retirement supplement act as earned income under the Social Security earnings test? Finally, does the check you receive after you retire for annual leave count as earned income under the Social Security earnings test? A. Only earnings from wages and self-employment…

OASDI and taxes

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Q. I recently started working part time. I requested taxes be deducted from my payroll.  I note that I am being taxed old age, survivors and disability insurance. Is it a mandatory tax if I’m already retired? A. Yes. Anyone who has earnings from wages or self-employment is required to pay that tax, even if he or she is already receiving a Social Security benefit.

Rehire

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Q. I did early retirement in 2005 by way of a buyout. I receive an annuity. What would the issue be if I return to federal service now? A. Because you didn’t meet the normal age and service requirements to retire, when you went back to work, your annuity would stop, and you wouldn’t be able to retire again until you did.

Medicare and Blue Cross/Blue Shield

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Q. I’m a federal retiree who is considering changing to Blue Cross/Blue Shield Basic during the next open season. How does Medicare Part A work in conjunction with BC/BS Basic? Which would be the primary? A. Medicare would be primary and your Federal Employees Health Benefits plan secondary. To find out how the two benefits would be coordinated, check with your plan.

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