CSRS Offset: resign or retire?


Q. I am a 59-year-old Army civilian and have 30 years of service as of early August. I had left government service and did not withdraw my contributions from CSRS. I came back to the government after a more-than-five-year absence in the private sector. Hence the CSRS Offset status.

Instead of retiring, could I resign and apply for my retirement at a latter age, say 62 or later? Between now and that time, I would be working in the private sector again contributing to Social Security. I still do not understand why the CSRS pension is reduced by Social Security contributed into outside of government service. This seems to be a penalty to the government employees.

A. When you retire and are eligible for a Social Security benefit, your CSRS annuity would be offset by the amount of Social Security benefit you earned while a CSRS Offset employee. The reason is simple. You can’t get two benefits for the price of one. Any other Social Security benefit to which you are entitled based on nonfederal employment will only be affected to the extent that you have fewer than 30 years of substantial earnings under Social Security. If you don’t, you’d be subject to the windfall elimination provision.

If you leave government and later apply for a deferred annuity, you won’t get credit for any unused sick leave you had when you left, your annuity will be based on your high-3 and years of service the day you left, and you won’t be able to re-enroll in either the Federal Employees Health Benefits or Federal Employees’ Group Life Insurance programs.


About Author

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

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