Q. You answered a question and said locality pay is in calculations for a FERS retirement. Is it also included for annuity calculation for a CSRS retirement? Also, I’ve seen confusing explanations about whether Social Security is reduced if a person receives a federal pension. I paid Social Security taxes during 11.5 years’ active military service and almost 15 years of National Guard and Army Reserve service. Will I be eligible for full Social Security benefits, or will there be reductions because I will get a CSRS retirement annuity?
A. Locality pay is included when computing the annuities of both CSRS and FERS retirees. Because you’ll be receiving an annuity from CSRS, a retirement system where you didn’t pay Social Security taxes, your annuity will be reduced if you have fewer than 30 years of substantial earnings under Social Security. Note: Substantial earnings aren’t the same as the amount of earnings needed to get a Social Security credit. For more information about the windfall elimination provision and how it might affect you, go to www.socialsecurity.gov/retire2/wep.htm.