Reg Jones Expert's View

Yeah, I know. Going back to work for the government after you’ve retired is only an outside possibility. But just suppose you did. What would happen to your annuity? Surprise, surprise! It all depends. In some cases, it will continue, in others it will stop. And, for a lucky few, you’ll be able to receive both your annuity and the salary of the new job. I’ll get to that last category later on. For now I want to talk about the first two.

If you voluntarily retired and go back to work, 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 $30,000 and your salary $80,000, you’d only paid $50,000 ($80,000 – $30,000).

On the other hand, if your retirement was involuntary due to such things as a RIF, job abolishment, transfer of function, reorganization or (in the latest jargon) right-sizing, your annuity would stop and you would 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.

Now let’s look at what happens if you retire again. If you worked on a full-time, continuous basis for at least one year – or its equivalent if you worked part time – you will usually be entitled to a supplemental annuity. That annuity will be tacked on to your original annuity. On the other hand, if you worked for at least five years, you will usually be entitled to elect a re-determined annuity, which replaces the one you are currently receiving. In either case, you’ll 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 took the new job, you’ll have to meet the age and service requirements to be eligible to retire again. For example, if you were a CSRS employee who took early retirement at age 46 with 25 years of service, you wouldn’t be eligible to retire again until age 55.

As mentioned above, a rare few reemployed annuitants will be able to receive both their annuity and a full salary. In the past, these exceptions related solely to positions for which there is exceptional difficulty in recruiting or retaining a qualified employee, a direct threat to life or property, or a circumstance that warrants emergency employment. Now 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 above applies to you.

If you are lucky enough to land one of these jobs, you need to understand that the time you spend in it can’t be used to qualify you for either a supplemental or re-determined annuity.