Maximizing Your Retirement Benefits

Except as explained below, anyone separating from service and receiving a refund of CSRS contributions must repay that money, plus any applicable interest, * before the period of time covered by the refund can be credited in the computation of annuity benefits. This period of service is called redeposit service. A redeposit can only be made by someone who currently has retirement coverage in the government.

Without a redeposit, the time involved can still be counted for meeting the minimum length of service for an immediate annuity, and for determining the high-3 average salary. However, no credit will be allowed in the computation of annuity unless the total amount owed is paid before retirement, unless the refunded service ended before October 1, 1990 or the individual is eligible to receive the Alternative Form of Annuity.

Anyone receiving a refund that covers a period of service that ended before October 1, 1990, including employment covered by another federal retirement system will not have to pay the redeposit to receive credit for that service before retirement (except a retirement for disability because disability benefits are not based on redeposit service). Instead, full credit for the refunded service will be allowed in computing the annuity, but the annuity will be actuarially reduced based on age and the amount of redeposit, including interest, owed at the time of retirement. If preferred, the redeposit can be paid and the actuarial reduction avoided.