Q: A friend told me that her monthly Social Security benefit was reduced by $250 because of the profits made from the sale of a house that she inherited from her mother. Can this be true? A: The Social Security earnings limit only applies to earnings from wages or self-employment, and then only for those individuals who haven’t reached full retirement age. In the ordinary course of events, income received through the sale of a home wouldn’t be considered to be earnings. However, if she reported any portion of the proceeds as earnings on her federal income tax return (because…
Browsing: Benefits
Q: I am a Civil Service Retirement System Offset retiree (15 years in offset) and turned 62 in October. I [was] scheduled to receive my first Social Security benefit Dec. 22. I have contacted the Office of Personnel Management on several occasions requesting to know how much my annuity will be offset, but no one seems to know. My annuity still has not changed. Is it normal for OPM to be late in changing (offsetting) annuities of CSRS Offset retirees? How will overpayments of my annuity be handled? A: Because you aren’t due for your first Social Security benefit check…
Q: I was hired after 1983 to a nonmilitary position. I left federal employment with a 40 percent Federal Employees Retirement System disability annuity. I was recently approved for Social Security disability. It is my understanding that per Federal Law 5 U.S.C. 8452(a)(2) that my monthly FERS disability check will be reduced by 60 percent of my Social Security disability benefit. That doesn’t seem fair. Isn’t there a bill pending in Congress that repeals this? Do you know which bill I should refer to when I contact my Congressman? A: That’s the law and, to the best of my knowledge, no…
Q: I will be retiring from federal service at age 58 with 35 years of service under the Civil Service Retirement System. I have been paying the 1.45 percent Medicare biweekly payment since its inception in 1983. Will this tax be deducted from my monthly CSRS annuity until I reach age 65? And, without 40 quarters of paying into Social Security, does paying the Medicare tax for 17 years qualify me for free Medicare Part A? A: Deductions for Medicare Part A are only required for those who have earnings from wages or self-employment, not annuities. The fact that you…
Q: I retired from the Army in 2007 and receive both military retirement pay and Veterans Affairs Department disability pay. I immediately went to work for the federal government under the Federal Employees Retirement System. When I retire from government employment, will I be paid all of the following: military retirement pay, VA disability pay, FERS retirement pay and Social Security benefits? A: Yes, you would be able to receive all four benefits. Just remember that your FERS retirement annuity would be based solely on your years of civilian service unless you chose to make a deposit for your years…
Q: Will federal retirees who pay Medicare through their federal pension because they have insufficient Social Security quarters ever receive a refund and correction for an improper raise in Medicare premiums in 2010? We, too, received no cost-of-living allowances. A: There wasn’t any “improper raise.” What you are referring to is the fact that when there wasn’t any cost-of-living increase in Social Security benefits in 2010, an increase in Medicare premiums for Social Security beneficiaries was prohibited under the “hold harmless” provision of that law. On the other hand, there wasn’t any legal restriction to the required increase in premiums…
Q: I am a federal employee covered under the Federal Employees Retirement System. I am also paying Social Security taxes. Would I receive 100 percent of my retirement from both systems given that I retired at the stipulated age? Will my Social Security pension change my FERS pension? A: If you retire on an immediate annuity after reaching the right combination of age and service (62 years old with five years of service, 60 with 20, or at your minimum retirement age with 30), you’ll receive an unreduced FERS annuity and, if you retire before age 62, the special retirement…
Q: I’m 56 years old, which is my minimum retirement age, with 12 years of credible service. If I applied for disability retirement, would I receive benefits based on my years of service or the “60 percent first year, 40 percent thereafter” rule? If I would only receive the “high-3” times years of service calculation, what would be the advantage, if any, of disability retirement? A: Because you aren’t eligible for an immediate unreduced annuity, your benefit would be calculated under disability rules. You’d receive 60 percent of your high-3 minus 100 percent of any Social Security disability benefit to…
Q: I am a federal employee and I am also receiving Social Security benefits. I understand that when I retire and start receiving my civil service annuity, my monthly Social Security benefits will be recalculated because of the windfall elimination provision. At the time I started receiving Social Security, my number of years of substantial earnings for WEP purposes was 23. Because I am a Federal Employees Retirement System transferee, my current salary is subject to FICA. Will the years subsequent to the initial receipt of Social Security will be added to my 23 years? In other words, if I…
Q: I have 33 years under the Civil Service Retirement System. Prior to that, I was with a private company and completed 32 quarters under Social Security. I will be 70 years old in June. My separation notice under the Base Closure and Realignment Act will be issued in June, and I will have to leave my job by Sept. 15. What are my best options to qualify for Social Security (40 quarters)? I understand there will be offset payments. Should I continue work two more years, finding another job after Sept. 15, and forget Social Security? A: You can…