Q. If one retires under the MRA +10 provisions with a penalty, how does the Internal Revenue Service view this situation as far as determining your income? Are there any special tax consequences related to the penalty? Simplified example: John Smith retires at age 56 with 25 years of service and his pension before the penalty is $2,000 per month. He now takes a 30 percent reduction (5 percent for each year under 62) and receives $1,400 per month. How does the IRS treat the income and penalty?
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Q. I am a FERS employee with the Postal Service with over 30 years of service, including my military time. I am considering retiring in a year. After I retire, will my health insurance premium be taxable? Or is it pretax?
Q. If I apply for CSRS medical disability retirement, what is the difference vs. a regular retirement? Would I be taxed at the same rate?
Q. I am a Postal Service employee under FERS. I originally planned to retire Nov. 28, 2014 to avoid another holiday season. First, can you retire with more than 440 hours of annual leave? Second, if I delay my retirement to the end of December and my annual leave is paid in January, will that lessen the taxes I would pay since my income would be less?
Q. Will I be able to draw Social Security if my husband is retired military and retired CSRS? I have work for more than 30 years paying Social Security tax and have been told I can’t draw. Will my husband be able to draw because he has paid Social Security tax as a self-employed contractor?
Q. I am a federal employee under CSRS enrolled in the Federal Employees Health Benefits program with self-and-family coverage for myself, my wife and my daughter (under age 26). We have been covered under the FEHB program for more than five years. My wife is also a federal employee under FERS. We also have FEDVIP vision plan coverage. I may retire next year, which will be three years or so before my wife retires. In view of the fact that as a retiree, my FEHB premiums would no longer be deducted pretax, I am considering canceling my enrollment and having…
Q. A federal employee who has worked for the Social Security Administration under CSRS since 1975 has, according to the earnings and leave statement, $103,887.34 in cumulative retirement. What does that figure represent?
Q. I plan on applying soon for a FERS deferred annuity. Nowhere have I read whether the Office of Personnel Management actually purchases an annuity from a private insurance company, creates its own version of annuities, or a FERS deferred annuity is simply a transfer of monies out of the General Fund (tax payments)? Please explain whether a FERS annuity is a private annuity contract, a public contract or just another tax payment transfer program (like the Social Security Administration). If it is private, what insurance company is used? If it is public, is this just another transfer program from…
Q. Do you know if I will have to pay Arizona income taxes on my FERS retirement benefit (Postal Service)? I am not disabled. I know I am exempt from federal income tax here in Arizona.
Q. I am looking at the Trust Fund Data of Social Security & Medicare Tax rates from the Social Security Administration website. For the year 1971-72, I see a 4.6 withholding rate under OASDI and .600 under HI. Would a federal employee covered under CSRS in 1972 have paid the 0.6 percent into Medicare? I know they would not pay the 4.6 under OASDI.