Retirement contributions and taxes


Q. I am a FERS retiree. My total retirement contribution that’s been taxed is $16,000. I understand this is averaged through my mortality and have a portion every month, tax free. Is there an option where I can take the total $16,000 and apply all in a given tax year as tax free even though that will eliminate the monthly, tax-free amount?

A. No, there isn’t any provision in law that would allow you to do that. But before I leave the subject, I need to tell you that the law which makes a portion of you annuity payments tax free didn’t change the other law that requires the Office of Personnel Management to return your retirement contributions to you first. Only after that money runs out will you begin to receive the government’s money. On average, a CSRS retiree will have received all of his contributions within 18 months. Because FERS retirees have contributed far less, they’ll receive all of their contributions much sooner.


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


  1. Not True Reg….

    I am a CSRS Retiree, and according the the rules (retiring at age 57) I will receive my contributions over a period of 310 months, NOT 18 months as you said. p\lease don’t give out false information. If I retired at age 55, it would take me 360 months to receive my already taxed contributions. This was changed during the Ronald Reagan years. (I am single, and the calculations for married are slightly different)

    • You are mistaken. While the actuarial tables may show that for tax purposes it would take that long, that’s not the way the law governing the return of contributions in an annuity works. I have checked with OPM more than once to confirm that what I wrote is true. You will first receive your own, already taxed, contributions in your annuity payments. Only then will you begin receiving the governments money.

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