Expert's View

Over the last two weeks I wrote about 1) the change of administration and what that might mean for federal employees and retirees, and 2) when those who just retired might get their first annuity payments. Now let’s look at going back to work for the government. What’s going on here?

What’s going on is that some of you left over the last four years because you didn’t like what had gone on; others left before the election because of what might go on if Trump were to be reelected. But he wasn’t. And now there are prospects of a return to the old normal, which in retrospect looks pretty good.

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Or, you may have other motivations for wanting to return, ranging from financial considerations to lifestyle considerations, or maybe a desire to help steer things in the direction you feel they should go.

If you go back, what happens to your annuity all depends. In some cases, your annuity will continue, in others it will stop. And, in a few cases, you’ll be able to receive both your annuity and the salary of your new job.

If you voluntarily retired and go back to work for the government, you will continue to receive your annuity; however, the salary of your new position will be offset by the amount of that annuity. For example, if your annuity was $40,000 and your salary $90,000, you’d only be paid $50,000 ($90,000 – $40,000).

On the other hand, if your retirement was involuntary, due to such things as a reduction in force (RIF), job abolishment, transfer of function or reorganization, your annuity would stop and you’d begin receiving the full salary of your new position. As a result, you’d have the same employment status as any other federal employee in an equivalent position with a similar service history.

If you return and work full-time for at least one year – or its equivalent if you worked part time – you would be entitled to a supplemental annuity. That annuity would be tacked on to your original annuity. On the other hand, if you work for at least five years or its equivalent, you’d be entitled to elect a re-determined annuity, which would replace the one you are currently receiving.

In either case, you’d have to contribute to the retirement fund, either while employed or before you retire again, to be eligible for those additional benefits.

Note: If your annuity stopped when you returned, you’ll have to meet the age and service requirements to be eligible to retire again. That could be a consideration if your original retirement was an early-out or a discontinued service retirement as described above.

As mentioned above, a rare few reemployed annuitants will be able to receive both their annuity and the full salary of their new position. In the past, these exceptions only related to positions where there was exceptional difficulty in recruiting or retaining a qualified employee, a direct threat to life or property, or a circumstance that warrants emergency employment.

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Today certain agencies (or portions of them) have been authorized to allow reemployed annuitants to receive both their annuities and their salaries. If you are a retiree who is being considered for reemployment, be sure to ask if one of the exceptions applies to you. If it does, be aware that the time you spend in it can’t be used to qualify you for either a supplemental or re-determined annuity.

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