Q: Now that the Defense Authorization Bill has been passed stating that federal employees overseas will be paid “Locality Pay” as opposed to a Cost of Living Allowance, when will we begin to receive the locality pay? A: Under Public Law 111-84, in calendar year 2010, affected employees will receive one-third of the locality rate paid in the “rest of the U.S.” locality; in 2011, two-thirds of the otherwise applicable comparability payment for each nonforeign area; and in 2012 and after, the full amount of the otherwise applicable comparability payment. Since the 2010 locality rate has not yet been announced…
Q: Can you please explain the process for deferred retirement under the Federal Employees Retirement System? If I decide to retire from federal government service early (with 25 or more years of service, but not the age) and defer retirement benefits, is the annuity when received not reduced? Also, if I move to another government system (e.g, state or local government), could I continue to receive my federal annuity when eligible at 56 years of age? A: Any employee leaving government before being eligible to retire can apply for a deferred retirement at a later date. If the employee has…
Q: I started working for the Postal Service in January of 1995 as a PTF clerk. Now I am a full-time employee. Under the Federal Employees Retirement System, how do my part-time hours get counted for retirement time? Over 14 years, I have between 12,000 and 13,000 hours. A: Go to to Office of Personnel Management’s chapter on the computation for part-time employees and scroll down to Subchapter 55B, Part 55B2.
Q: Which states do not tax federal retirement benefits? A: States with no personal income taxes include Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. Those states that exempt the total amount of civil service annuities include Alabama, North Carolina (beginning in 1998 if the individual had five years of creditable government service as of Aug. 12, 1989), Michigan, Illinois, Pennsylvania, New York, Kentucky (only if retired before Jan. 1, 1998), Hawaii, Oregon (not taxed if retired before Oct. 1, 1991; if retired on that date or later, only taxed on the portion earned after that…
Q: Mr. Jones answered a question on Dec. 2 (“Annual leave and returning to federal service”) pertaining to lump-sum payment for annual leave for one returning to federal service. The answer was: “As required by law, you will have to return every penny you received for annual leave that hasn’t expired between the time you retired, and the time you return to work.” Two questions: Can you provide citations to statute and/or regulations that require this result? And what does “hasn’t expired” mean? The leave year typically ends in early January. If you retire in July and return to work…
Q: I am retiring Jan. 2, 2010, and hope to return as a retired annuitant with dual comp waived. My human resources group tells me if I return that I will have to repay my annual leave lump sum unless I don’t return until after the period of time my leave hours would have been used up. Can this be right? Why does the government care about the annual leave payment? It’s like starting any second job — I should have no annual leave but should not need to return the payment. A: As required by law, you will have…
Q: Let’s say I have six months of sick leave credit. Can I retire at age 61 1/2, and qualify for the multiplier of 1.1 that we get at age 62? A: No, you can’t. Sick leave may only be added after you have met the age and service requirements for a retirement benefit.
Q: Do I have to pay taxes on my disability annuity if I am totally disabled and unable to perform any work at any job? Is this information shown on my 1009-D/R? A: There isn’t any federal tax exemption unless you are totally disabled for all gainful employment. Since that is not a determination that can be made by the Office of Personnel Management, you’ll need to check with the IRS to learn if you qualify. Check with your local IRS office or go to http://www.irs.gov.
Q: I was hired on Oct. 18, 1982, with the Postal Service as a temporary employee. In April 1984, I became a career employee, but later “bought back” my temporary time, so all my Form 50s show a hiring date of Oct. 18, 1982. I have always paid Social Security on my earnings. I have never understood why I did not fall under the Civil Service Retirement System instead of the Federal Employees Retirement System. I tried to research it with human resources, and they said I missed CSRS by 17 days (something about the five-year rule). I have not…
Q: I bought back four years of military service last month. If I can take this off my taxes for 2009, will it show on my W-2 forms and leave and earnings statement? A: No, you can’t take it off your taxes and it won’t show up on either your W-2 or your leave and earnings statement.