Retirement FAQs

We are very much aware of the increasing processing times retirees and potential retirees have been experiencing. Individuals applying for retirement are dedicated Federal employees who have devoted their careers to serving the citizens of this country, and as such, they deserve treatment commensurate with their service. The present situation is the result of the confluence of a number of factors. This includes the attempt to utilize an "off-the-shelf" private sector processing system, which ultimately was not successful. We tried to redesign all aspects of retirement processing simultaneously and anticipated that increased automation was the long-term solution. Accordingly, we assumed lower staffing levels would be required. As staff levels were reduced, the volume and complexity of retirement casework increased. Our paramount goal is to improve the overall claims adjudication process. There is no simple or easy solution that is capable of instantly remedying the problem, but we are doing everything in our power to improve service to our annuitants as rapidly as possible within the constraint of available resources. We have begun several initiatives to not only speed up claims review but to streamline other attendant retirement procedures. We hired 40 legal administrative specialists to assist with the current backlog and future workload. We have also authorized additional overtime across the claims processing groups and will continue to approve overtime thru fiscal year 2011. Overtime is also being offered to former claims examiners to help tackle the backlog. To assist the retiree's immediate financial needs, OPM established an interim pay process to provide new retirees with income while their retirement benefits are adjudicated. Retirees receive their first interim payment in 5-7 business days from the date the agency's electronic file or paper records are received by OPM. OPM uses the information provided by the agencies (at the time the retirement application is submitted) to determine the amount of interim pay. In calculating the amount of the interim payment from the data provided by the agency, OPM:

• Determines the years and months of creditable Federal service
• Uses the retiree's final salary
• Accounts for any survivor election
• Applies a reduction for age if appropriate
• Reduces the amount of interim payment to cover premiums for any insurance elections.

Our goal is to provide the annuitant with as much of their expected NET monthly payment, less Federal income tax withholding. The NET payment amount is the amount of the annuity payment after deducting premiums for health benefits and life insurance from the gross rate. Some retirees receive less than our goal due to a variety of factors. Some of the conditions that could cause the annuitant to receive less than the agency's NET estimate are: a FERS annuity supplement, unpaid service credit deposits, redeposits or military deposits, a court order on file at OPM, or the retiree is entitled to a special computation as a Law Enforcement Officer, Fire Fighter, Air Traffic Controller or other special retirement group. In December, we increased all Department of Defense civilian retiree interim payments by 5%. This will affect 29% of the cases. These cases had been receiving a lower than average amount of interim pay based upon the data received at the time of retirement. Additional system changes are in process to provide a 5% increase for certain retirees of the United States Postal Service. OPM is currently working with agencies to improve timeliness and quality of personnel/payroll information submissions. Indeed, OPM's Strategic Plan speaks to the shared responsibility for retirement processing among employees, agencies and OPM so resolving these issues is at the very center of the radar screen. Incomplete or inaccurate information from agencies can significantly delay processing and ultimately, a retiree's check. Unfortunately, 23 percent of all claims received are missing one or more records and 11 percent are not received during the first 30 days. We are confident that through additional staff, over-time, improvements in interim payments, and collaboration with agencies we will reduce our back-log to more normal levels and fulfill our commitments to the Federal retiree, which has always been one of our highest priorities.  

Use Services Online to:

• start, change, or stop Federal and State income tax withholdings;
• request a duplicate tax-filing statement (1099R);
• change your Personal Identification Number (PIN) for accessing our automated systems;
• establish, change, or stop an allotment to an organization;
• change your mailing address;
• start direct deposit of your payment or change the account or financial institution to which your payment is sent;
• establish, change, or stop a checking or savings allotment; and
• view a statement describing your annuity payment.

You can also call our toll-free number 1 (888) 767-6738 , for these and many of your voluntary withholdings. When using our self-service systems, you need your claim number, Personal Identification Number (PIN), and social security number. If you do not have a PIN, call us. If you do not have a touchtone telephone, you can speak to a Customer Service Specialist. Generally, in the middle of month, we authorize payments that are due for the first business day of the following month. Therefore, if you want your change to be reflected in your next payment, you should submit your request as early in the month as possible. See our payment schedule for the last date you can change your next monthly payment.

To qualify for payments from the Civil Service Retirement System (CSRS) or the Federal Employees Retirement System (FERS), you must submit a retirement application. They are available on our website, as follows:

• Application for Immediate Retirement (CSRS), Standard Form (SF) 2801 [1.2 MB]
• Application for Immediate Retirement (FERS), Standard Form (SF) 3107 [1.0 MB]

You should submit an application for immediate retirement as shown below.

If your agency undergoes a major reorganization, reduction in force, or transfer of function, and a significant percentage of the employees will be separated, or will be reduced in pay, the head of your agency can ask the U.S. Office of Personnel Management (OPM) to permit early optional retirement for eligible employees. If your agency gets approval to permit early optional retirements, eligible employees will be notified of the opportunity to retire voluntarily. Information about Early Optional Retirement under CSRS is available here.  Information about Early Optional Retirement under FERS is available here.

The basic Civil Service Retirement System (CSRS) annuity cannot exceed 80 percent of your high-3 average salary, excluding your unused sick leave. Generally, you reach the 80 percent limitation when you have 41 years and 11 months of service, not including accumulated sick leave.   Fewer years of service may result in a computation that produces the maximum benefit under special computation formulas such as for law enforcement personnel. Your service beyond the years which provides the maximum benefit will not be used to compute your annuity.  Instead, we will automatically refund the retirement contributions you made during those years.  Interest is paid on this refund payment at the rate of three percent per year, compounded annually.  You can use the refund to purchase additional annuity, as if  the contributions and interest are voluntary contributions. However, if you have federal civilian employment periods when you did not contribute to either the Civil Service Retirement System (CSRS) or the Federal Employees Retirement System (FERS), we automatically apply excess contributions toward any deposit due for these employment periods.

If you retired before December 9, 1980, your Basic life insurance will begin to reduce by 2 percent of the face value each month beginning with the second month after your 65th birthday or your retirement date, whichever is later. This reduction continues until your Basic life insurance reaches 25 percent of the face value. This coverage is free. If you retired on or after December 9, 1980, and before January 1, 1990, you elected one of the following reduction schedules for your Basic life insurance:

• 75 percent reduction - If you elected this reduction schedule, your Basic life insurance will begin to reduce by 2 percent of the face value each month beginning with the second month after your 65th birthday or your retirement date, whichever is later. This reduction continues until your Basic life insurance reaches 25 percent of the face value. This coverage is free.
• 50 percent reduction - If you elected this reduction schedule, your Basic life insurance will begin to reduce by 1 percent of the face value each month beginning with the second month after your 65th birthday or your retirement date, whichever is later. This reduction continues until your Basic life insurance reaches 50 percent of the face value. We withhold premiums for this coverage from your annuity beginning at retirement and continuing for life.
• No Reduction - If you elected this reduction schedule, the full amount of your Basic life insurance remains in force after you reach age 65. We withhold premiums for this additional coverage from your annuity beginning at retirement and continuing for life.

If you retire after December 31, 1989, you must elect one of the three reduction schedules described above when you retire. Regardless of which reduction schedule you elect, if you separate before age 65, until you are 65 you must also pay the same premium as employees for the Basic life insurance you continue into retirement. The amount of Option A - Standard insurance (formerly known as "Optional insurance") is $10,000 at retirement. If you retired before October 30, 1998, your Option A insurance may have been higher than $10,000. If you have this coverage, it will begin to reduce by 2 percent per month or $200, beginning the second month after your 65th birthday or your retirement date, whichever is later, until it reaches 25 percent of the face value or $2,500. We will withhold premiums for Option A insurance from your annuity through the end of the month in which you are 65, unless you elect to cancel this coverage. All annuitants with Option B - Additional insurance as of April 24, 1999, or later, are eligible to make an Option B reduction election. Those who are 65 or older at retirement will hear from us shortly after retirement. We will contact annuitants who retired before age 65 shortly before their 65th birthday. At that time, the annuitant may elect either Full Reduction or No Reduction for each separate multiple of Option B. For example, a person with five multiples may elect No Reduction on two multiples, while the three remaining multiples reduce fully. If you elect Full Reduction, effective the first day of the second month after your 65th birthday or your retirement date, whichever is later, your Option B full-reduction multiples will reduce by 2 percent of the face value per month for 50 months, at which time this coverage will end. We will withhold premiums for this coverage from your annuity through the month in which you reach age 65. If you elect to continue some or all of your Option B multiples with No Reduction, when you are 65 or at retirement, whichever is later, we will adjust the withholding for your Option B coverage to reflect the number of multiples you decided to retain at No Reduction. Any other multiples will start to reduce as described above. All annuitants who have Option C - Family insurance, and whose annuity commencing dates are April 24, 1999, or later, are eligible to make an Option C reduction election. Those who are 65 or older at retirement will hear from us shortly after retirement. We will contact annuitants who retired before age 65 shortly before their 65th birthday. At that time, the annuitant may elect either Full Reduction or No Reduction for each separate multiple of Option C. For example, a person with five multiples may elect No Reduction on two multiples, while the three remaining multiples reduce fully. If you elect Full Reduction, or if you separated for retirement before April 24, 1999, effective the first day of the second month after you reach age 65 or your retirement date, whichever is later, your Option C full-reduction multiples will reduce by 2 percent of the face value per month for 50 months, at which time this coverage will end. We will withhold premiums for this coverage from your annuity through the month in which you reach age 65. If you elect to continue some or all of your Option C multiples with No Reduction we will adjust the withholding for your Option C coverage to reflect the number of multiples you decided to retain at No Reduction. Any other multiples will start to reduce as described above. For more complete information about life insurance coverage as an annuitant, please check the life insurance pamphlet, Information for Retirees and Their Families: Federal Employees Group Life Insurance, RI 76-12.

This is a provision that allows you to retire with benefits beginning immediately if you have ten years of service and have reached the Minimum Retirement Age (at least 55). However, the annuity is reduced for each month you are under age 62. The reduction equals five percent per year (or 5/12 of one percent per month). To avoid the reduction, you can postpone payment. You can later apply for the benefit by writing to us or filing an "Application for Deferred or Postponed Retirement," Form RI 92-19. You should submit the form two months before you want the benefit to begin.

If you have not already done so, you should choose your exact retirement date. Afterwards, your benefit can be estimated based on the exact date. The best place to obtain assistance is your agency's local personnel service center.   They can provide personalized assistance and they have your employment records.  They will provide you with information on when your benefit payments can begin based on your proposed retirement date.  You will also find out how this date affects factors used to determine the amount of your retirement benefit, such as your length of service, high-3 average salary, and the proration of cost-of-living adjustments.

You may receive a CSRS survivor annuity and social security payments. You may receive a FERS survivor annuity and social security payments.  However, if you are the survivor of a FERS retiree, you cannot receive the FERS survivor supplement if you are eligible for social security mother, father or disability benefits based on the deceased annuitant’s account.  Please contact the local office of the Social Security Administration for information about social security benefits. If you receive social security benefits based on your own employment, there may be a reduction in the social security benefit you receive based on your deceased spouse's service. Contact the Social Security Administration for more information about the Government Pension Offset at http://www.ssa.gov/pubs/10007.html. See the information below about benefits which may be payable to the surviving spouse of a deceased annuitant who was covered by the Civil Service Retirement System (CSRS) Offset program. Under these circumstances, a survivor may be eligible for both a CSRS annuity and social security benefits.

The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act was passed by the United States Congress on December 16, 2010 and signed into law on December 17, 2010. As a result, the IRS published the tax withholding tables later than usual for 2011. OPM applied the tax tables as quickly as possible but there was not enough time to apply these tables to the January 3, 2011 annuity payments.

If you are a current employee, you should contact your human resources office. If you have separated from federal service or are currently a retiree, you should contact OPM’s Retirement Office at 1-888-767-6738 or retire@opm.gov.  The phone lines are open from 7:30 am to 7:45 pm (Eastern Standard Time). It is a busy phone number so we encourage you to call early in the morning or after 5:00 pm when the phone lines are less busy.

The withholding changes affect the February 1, 2011 payment and subsequent annuity payments.

To report a death of someone who receives benefits from us, you can:

• Contact us online:  Report a Death
• Call us: 1-88USOPMRET — 1 (888)767-6738
• Write to us at:

U.S. Office of Personnel Management Retirement Services Program Post Office Box 45 Boyers, PA 16017-0045

If you are reporting the death of someone who receives benefits from us, please provide us with the full name of the deceased and date of death, as well as the retirement claim number, if known, and social security number. You should also include your name, address, and telephone number. When we receive the report that someone who receives benefits from us has died, we will stop annuity payments and ask survivors who may be eligible for benefits to apply. In many cases, we can start monthly payments to an eligible surviving spouse based on the records on file. Payments made to a retiree after the date of his or her death are not negotiable. In addition, survivors may not be eligible for the full amount of such payments. Therefore, the Department of the Treasury will reclaim all direct deposit payments made after the date of death from the financial institution to which they were disbursed. The financial institution will debit the account to which the payments were previously credited. The annuitant's account should remain open until reclamation of any payments is completed. Uncashed checks payable to the deceased must be returned to the U.S. Department of the Treasury. You should void any uncashed checks by noting the annuitant's date of death on them before returning them. Voided checks should be returned to the following address: U.S. Department of the Treasury P.O. Box 24720 Oakland, CA 94623-1720 In addition, Benefit Officers can use our website to report the death of an employee and help us expedite payments to family members.

You can voluntarily withhold Federal and State income taxes, checking and savings allotments, or allotments to other participating organizations. Federal Income Tax: Generally, unless you specify a monthly withholding rate or amount, we withhold Federal income tax as if you are married and claiming three allowances. Use Services Online to start, change, or stop the Federal tax withheld from your annuity payment or specify the dollar amount withheld. You can also call us or write us to change your withholding amount. If you write, your letter should include your claim number and the monthly amount in dollars you want withheld. If you write, we will send you a Form W-4P-A, "Election of Federal Income Tax Withholding," and instructions for making the change. The change in your withholdings will be made after we receive your Form W-4P-A. You may change the amount withheld whenever you think it is necessary. Please note that you may be penalized by the Internal Revenue Service (IRS) if you do not have at least 90 percent of your yearly tax liability either withheld from your salary or annuity or made via quarterly payments to the IRS. If you need more information or assistance in determining whether or not you are having the right amount of Federal income tax withheld, see the Internal Revenue Service website at http://www.irs.gov. State Income Tax: You must specify the dollar amount of State tax you want withheld from your monthly payments. The withholding must be in whole dollars. The minimum amount we can withhold for State income tax is $5. Use Services Online to start, change, or stop the State tax withheld from your annuity payment. You can also call us or write us to change your withholding amount. If you write, your letter should include your claim number and the monthly amount in dollars you want withheld. If you do not know the monthly amount you want withheld, contact your State tax office for information or assistance. Check our list of State tax offices for information about participating States. If your State does not participate, please contact the State tax office for information or assistance. Savings Bonds: As of April 1, 2009, The Office of Personnel Management is no longer withholding for the purchase of savings bonds. Please contact your bank or other financial institution or the Department of the Treasury to purchase these bonds. For further information on Savings Bonds visit the Treasury Direct website or call 1 (800) 4US-BOND. Allotments to Organizations: You can start, change, or stop an allotment to participating organizations. Participating organizations include:

• American Federation of Government Employees (AFGE);
• Fraternal Order of Retired Border Patrol Officers (Museum);
• National Association of Postmasters of the U.S. Political Action Committee;
• National Rural Letter Carriers Association Political Action Committee;
• National Treasury Employees Union (NTEU);
• Northwest Plan Administrators; and
• Treasury Employees Political Action Committee.

If the organization for which you wish to make an allotment is not listed above, you should contact them and ask them to provide us with the banking information needed to forward payments. The organization can contact us by email at finance@opm.gov. Use Services Online or call our toll-free number to make one-time or recurring membership payments to organizations. Checking and Savings Allotments:  Checking and savings allotments are voluntary deductions for allotments sent by direct deposit to a checking or savings account in your name. You may have up to two allotments. The accounts must be maintained at a domestic financial institution. This does not include charities, savings bonds, garnishments or other court orders, union or other organizational dues. You must maintain at least $100 net annuity payment. The allotment must be for a minimum of $50. Use Services Online to start, change, or stop an allotment or call our toll-free number to establish a checking or savings allotment.