Q: I retired with 42 years of federal CSRS service. Two years later I was rehired by my former agency and have been paying into the CSRS system for 8 years. Can you tell me how they will recalculate my new pension, and will I receive a refund for all the money I paid into the retirement fund?
A: Your annuity will be recalculated as if you had never retired, using the standard CSRS formula. Your high-3 will be based on your highest three consecutive years of average salary, whenever that occurred in your career. Since a CSRS annuity can’t exceed 80 percent of your high-3, any contributions you made to the retirement fund that would cause you annuity to exceed that limit will be returned to you, with the option of purchasing additional annuity that isn’t subject to the 80 percent limit.