Retirement & Financial Planning Report

Image: Anirut Krisanakul/Shutterstock.com

Some people who take disability retirement from federal employment recover to the extent that they can return to work, and naturally many of them look to return to the government.

Although you can be reemployed by the government in any position for which you are qualified, the law doesn’t require either your former agency or any other federal agency to automatically offer you a job. You’re on your own when it comes to finding one.

ADVERTISEMENT

If you are successful and are reemployed by the federal government, what happens to your disability annuity depends on your age and the circumstances of your reemployment

If you are under age 60 and are reemployed in a job that is equivalent in tenure and pay to the one you left, you’ll be found to have recovered from your disability and your annuity will stop. If you have already been found to have recovered or restored to earning capacity, the temporary annuity payments you have been receiving during the year following that determination will stop on the date you are reemployed, regardless of the type of appointment you receive.

If you are under age 60 and haven’t been found restored to earning capacity or to have recovered from your disability, your disability annuity will continue if you are reemployed

• in a position of different tenure, for example, temporary vs. permanent,
• at a lower grade level that the one you occupied when you retired, or
• at a lesser tour of duty that the one you had when you retired.

While your disability annuity will continue under any of these circumstances, the salary of your new job will be offset by the amount of your annuity while you are reemployed.

Note: If you are 60 or older when you are reemployed, the same offset rule applies. However, it’s worth noting that if you are employed in a permanent position that has a salary equal or greater that the one from which you retired, OPM won’t find that you’ve recovered from your disability unless you ask them to do so.

So, what happens if you go back to work for the government and want to retire again? If you weren’t found recovered from your disability or restored to earning capacity and you work full time for a full year (or its part-time equivalent), you’d be eligible for a supplemental annuity when you retire. If you work for five or more years (or its part-time equivalent), you’d be eligible for a redetermined annuity.

ADVERTISEMENT

On the other hand, if you were found recovered or restored to earnings capacity, you might be entitled to the restoration of your disability annuity if you haven’t earned a new annuity right, either immediate or deferred, by virtue of your additional period of actual service. However, restoration of your disability annuity will only happen if you can prove that your disability has recurred and that you are no longer restored to earnings capacity.

Federal Retirement Mistakes to Avoid

Last-Minute Retirement Checklist

Using the Benefits Open Season to Your Best Advantage

Open Season Choices: FEHB, FEDVIP, FSAs

White House Releases Vaccination Data by Agency

OPM Addresses Standards for Ending Telework Arrangements

TSP Investors Handbook, New 7th Edition