Maxed out


Q. After 40 years and 11 months of federal service, you are maxed out at 80 percent. Any CSRS held from your check after that is paid plus 3 percent interest, and the only money taxed is the interest, correct? If you take payment in a lump sum, is it usually paid as fast as the annual leave payment?

A. First, a correction. As a CSRS employee, you are entitled to 80 percent of your high-3 after 41 years and 11 months of service, not 40 years and 11 months. Now let’s move on.

When you retire, the Office of Personnel Management will determine the amount of excess contributions and offer you an opportunity to either receive a refund of those contributions, plus 3 percent interest, or use the money to purchase additional annuity, which, like unused sick leave, isn’t subject to the 80 percent limit. This offer will be made by OPM before it finalizes your annuity. If you decide you want the money, it won’t be paid out anywhere near as fast as the lump-sum payment for annual leave, which is made by your agency.


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Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to

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