Last week I pointed out that you could get credit for active duty service in the armed forces in determining your length of service and have it used in the computation of your annuity. Now I want to get into the rules that govern the making of deposits to get that credit.

CSRS rules
If you are a CSRS employee who served in the military after December 31, 1956, you can get retirement credit under both your civilian retirement system and Social Security. However, there’s a catch. It’s called Catch-62. Whether you need to make a deposit for that time depends on two things, when you were first hired and if you will be eligible for a Social Security benefit.

If you were first hired before October 1, 1982, it’s up to you to decide whether to make the deposit. Either way, you’ll get credit for your military service in determining your length of civilian service. However, if you don’t make the deposit, retire, and are eligible for Social Security at age 62 (or when you retire if it’s at or after age 62), those years of service will be dropped and your annuity recomputed without them.

On the other hand, if you were hired after September 30, 1982, you’ll only get credit for your post-1956 military service if you make a deposit.

If you decide to make a deposit, in general that amounts to 7 percent of your basic pay while on active duty (not including allowances and differentials), plus accrued interest. Payments can be made in a lump-sum or in installments as small as $50. However, you must complete the deposit before you retire if you want to get any credit for your military service.

FERS rules
If you are a FERS employee, you can only receive civil service credit for post-1956 military service if you deposit an amount equal to a percentage of the military basic pay you earned while on active duty. In general, that deposit is 3 percent, plus accrued interest. Just as is true for CSRS employees, deposits can be as small $50. And you must complete the deposit before you retire if you want to get any credit for your military service.

How to make a deposit
If you have a DD-214 or its equivalent, attach it to a copy of form RI 20-97, Estimated Earnings During Military Service. You can download one at www.opm.gov/forms. Mail the package to your branch of service. (The addresses are on the back of the form.) Your service center will verify your earnings.

If you don’t have a DD-214, you’ll have to fill out a Standard Form-180, Request Pertaining to Military Records (available on-line at www.opm.gov/forms) and send it to your branch of service. (Once again, the addresses are on the back.) Your records center will send you a new DD-214 or its equivalent. Attach that to a completed RI 20-97 and mail it to your branch of service to get an earnings estimate.

With that information in hand, go to www.opm.gov/forms and download a copy of Standard Form 2803 (CSRS) or 3108 (FERS). When you’ve filled out the form, take it to your payroll office along with a copy of your DD-214 or equivalent, and the statement of estimated earnings you got from your finance center. Your payroll office will figure out how much you owe, including accrued interest.

Next week I’ll wrap things up by telling you how to decide if you should make a deposit.