Getting Credit for Active Duty Service – Planning Ahead

Military service may be utilized to boost your years of service and may allow you to retire sooner – and with a larger annuity – than if you relied just on your FERS or CSRS employment.

Who is eligible for the credit?

You can earn credit for time spent in the United States military forces if it was 1) active duty that ended honorably and 2) completed before you retired from your civilian career. The Army, Navy, Air Force, Marine Corps, Coast Guard, and service academies are all included in the term “armed forces.” It also serves in the Public Health Service’s Regular or Reserve Corps and as a commissioned officer with the National Oceanic and Atmospheric Administration.

Credit guidelines in general

By contributing to the Civil Service Retirement and Disability Fund, you can obtain credit for any time of active duty service – barring weekend exercises (CSRDF). The deposit amount will be a proportion of your basic pay while on active duty. You won’t be charged interest if the deposit is made within two years of your first day on the job. Interest will be levied after that.

Making a deposit will not affect your right to reserve retired pay if you are a reservist. Suppose you are getting military retired pay, on the other hand. In that case, you normally cannot continue to earn that benefit while still collecting credit for your service in your civilian annuity.

The only exceptions are if you were given military retired pay for a service-connected disability sustained in combat with an enemy of the United States or caused by a weapon of war and sustained in the course of duty during a war. Suppose you don’t qualify for one of the exclusions. In that case, you can keep your military retired pay and have your FERS or CSRS annuity based entirely on your civilian service, or you can forego the military retired pay and make a deposit to the CSRDF to get credit for your service toward a FERS or CSRS annuity.

Specific guidelines for obtaining credit

If you are a FERS employee who served in the military after 1956, you will only be able to earn credit for that period if you deposit the CSRDF. While on active duty, the deposit is usually 3% of your base pay plus interest.

To have that service credited for civilian retirement purposes, you must pay a 7% deposit (plus interest).

You would have two options if you were hired before October 1, 1982, as a CSRS employee. You can pay the 7% deposit for any post-1956 military service or opt out. The consequence of failing to pay the deposit is straightforward. Those years of non-deposit service will be deducted from your CSRS pension if you become eligible for Social Security at age 62. 

Contact Information:
Email: Betty@PSREducators.com
Phone: 8889193252

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