CSRS, survivor annuity and Social Security


Q. I have two questions about the Reg Jones article in the Feb. 18 Federal Times issue, titled “2013 brings changes to Medicare, survivor benefits” (Page 22).

1) Under death benefits, it says, “under CSRS, if you die while still employed, your widow will be entitled to a survivor annuity.” When I retired in 1995, I signed an agreement to take a reduction in my annuity so that when I die, my wife will get a percent of my annuity. Please explain what is wrong with one of these two statements.

2) Under the same topic, he says, “the spouse will get a survivor benefit equal half of my basic Social Security if I had 10 years of payment.” I fully qualified for a full Social Security benefit; however, the government sees fit to steal most of my earned benefit because I receive an annuity. Please clarify the status.

A. 1. Nothing is wrong with these two statements. Had you died while still employed under CSRS, your wife would have been entitled to a survivor annuity. Because you retired, you were able to elect a survivor annuity for her. In the first case, it would have automatically been a full survivor annuity; in the second, also a full survivor annuity, unless she agreed in a notarized writing to a lesser amount or none at all.

2. That’s not what it says. If you were a FERS employee, your spouse would receive a variety of benefits based on your length of service when you died. Among them would be a lump-sum payment and any Social Security survivor benefit to which she would be entitled based on your work history. In addition, if you had at least 10 years of service, she would receive a survivor annuity equal to half of what your basic annuity would have been based on your years of service.

Finally, since you are clearly a CSRS-covered retiree who was eligible for a Social Security benefit, you were subject to the windfall elimination provision. The WEP reduces the Social Security benefit of anyone who receives an annuity from a retirement system where he didn’t pay Social Security taxes, such as CSRS, and has fewer than 30 years of substantial earnings under Social Security. The WEP isn’t an example of stealing.

Instead, because the formula is tilted toward low-income workers, it avoids the overpayment of those who have earned an annuity without contributing to Social Security and just picked up enough credits along the way to apply for a benefit. To better understand the WEP, go to http://ssa.gov/pubs/10045.pdf.


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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