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Federal Employees and Divorcees: FERS and CSRS Annuities Vs. Court Order.

Divorce can be devastating for the average person because of the high legal fees and the emotional toll it takes on the entire family. Some federal employees are currently facing divorce, while others have to deal with divorce in the future, and such statistics will continue to grow. While working for the government, most federal employees have accrued substantial retirement and insurance benefits. This article will discuss the impact that divorce-related court orders can have on a federal employee’s CSRS or FERS annuity. Apportionment Orders Federal employees who are divorcing or legally separating from their spouse may receive a portion of their CSRS or FERS retirement and disability benefits or a refund of their contributions to the Retirement and Disability Fund, depending on a court order. According to the law, OPM must apportion an annuity or refund an employee’s contributions to the CSRS or FERS Retirement Disability Fund based on the express provisions of a qualifying court order, court decree, or property settlement. Moreover, suppose the terms of the court order explicitly demand payment in this manner. In that case, OPM is authorized to make payments directly to the former or separated spouse. A court order should state precisely what the court expects OPM to do in the case of a CSRS or FERS annuity or a refund of an employee’s contributions to the CSRS or FERS retirement and disability funds. The spouse’s portion of an annuity must be expressed as a fixed dollar amount, a percentage, or a fraction of the annuity, or as a formula whose value can be easily determined by OPM. OPM will not comply with a court order unless the order is specific and unambiguous. The Apportionment Order Filing Requirement The former spouse (or attorney) must submit a written request to OPM and provide proper documentation to establish the validity of the court order before any benefits can be paid to the former spouse. To be eligible for a portion of their ex-CSRS spouse’s or FERS annuity check, the former spouse must apply in writing (no oral requests)â€â€either personally or through a representative. The letter requesting a portion of the CSRS or FERS annuity must be sent to the OPM. Obtaining a Survivor Annuity A court order stating the former spouse’s entitlement to a survivor annuity or directing an employee or retiree to provide a former spouse survivor annuity is required for awarding a former spouse survivor annuity. If any of the following apply, a court order granting a CSRS former spouse annuity does not qualify: (1) the marriage ended before May 7, 1985; or (2) retired federal employees who divorced before May 7, 1985, but whose spouses did not receive a current spouse annuity as of May 7, 1985. It is worth noting that Internal Revenue Code Section 1041 became effective on May 7, 1985, when the IRS rewrote tax regulations about divorce. Deferred annuities can be awarded to the ex-spouses of CSRS employees who have been divorced. Suppose you were employed by the federal government for more than 20 years and separated from service before age 55. In that case, you are eligible for a deferred retirement annuity. Suppose the government employed you for less than 20 years. In that case, you qualify for a deferred retirement annuity until you reach the age of 62. Unless the separated CSRS employee dies after 62, no survivor annuity will be paid in the event of a CSRS-deferred retirement. Any FERS employee who left the federal service before the retirement age is eligible for a deferred retirement as a separated individual. Unless the separated FERS employee dies after the minimum retirement age (MRA), after reaching the age of 60, or after reaching the age of 62, no survivor annuity will be paid in the case of a FERS-deferred retirement. Employees eligible for CSRS or FERS retirement may reduce their annuity payments to provide a survivor’s benefit to their ex-spouse. A remarried employee may request this election if the current spouse consents to the election or if the OPM waives the spousal consent requirement. The survivor annuity entitlement of a CSRS or FERS employee terminates at the end of the month preceding the earliest of:

  1. The death of the former spouse.
  2. The remarriage of the former spouse before the age of 55 or if the marriage of the former spouse to the employee or retiree lasted less than 30 years.
  3. The survivor annuity termination date is established under the terms of the court order.

If a former spouse’s survivor annuity terminates due to one of the three conditions listed above, any reduction in the retiree’s annuity to provide a former spouse annuity will cease the first day of the month following the terminating event unless in the following case. A former spouse who loses eligibility for a survivor annuity due to remarriage before age 55 cannot request that the annuity be reinstated upon the death or dissolution of the subsequent spouse. Within two years of the death or remarriage of the former spouse, the retiree can choose to maintain or increase the annuity provided to another former spouse or to provide an increase to their current spouse. Suppose a former spouse’s marriage to a federal employee or retiree lasted less than 30 years, and she remarried before age 55. In that case, she no longer has the right to a survivor annuity. The annuity cannot be reinstated if the marriage is annulled unless the following conditions are met: (1) the decree of annulment states that the marriage is without legal effect retroactively from the date of the marriage, and: (2) the former spouse’s entitlement is based on Section 4 in limited circumstances, this provision provides survivor annuities without reducing the retiree’s benefits.
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Kathy Hollingsworth

Kathy Hollingsworth – Federal Employee Benefits Specialist Originally from Birmingham, Kathy received her advanced education at Birmingham-Southern College. Kathy’s professional career began with 30 years in the media industry (radio and television), but will end serving senior citizens. As director of a senior center for five-and a half years at the largest senior center in central Alabama, Kathy has devoted her life to meeting the needs of senior citizens. Due to continuing education and working with companies that specialize in finding the best financial products, Kathy stands ready to help her clients find solutions to the problems that arise while in retirement and planning for retirement retirement. For the last eighteen years, Kathy, a Federal Employee Benefits Specialist, has assisted in helping federal employees make wise, frugal retirement decisions. Kathy also became a Registered Rep in 2018 (CRD 6832692) and an Investment Advisor Representative (Fiduciary) in 2021. In addition, Kathy is a licensed mortgage originator (License #212553), specializing in VA, FHA and Conventional mortgage loans. Kathy has written many articles for the Montgomery Area Council on Aging, Montgomery Advertiser, and Alabama Gerontological Society on the subject of seniors. Kathy was the keynote speaker at Alabama’s State Capitol in Montgomery for the State Combined Campaign Salute to Seniors in 2005. Kathy also writes articles on Federal Benefits and Insurance subjects. A Certificate of Recognition was awarded to Kathy in 2005 by Governor Bob Riley for her service to state, family and community. Every free moment Kathy gets is spent with her grandson Konner and two dogs, Sallie, and Sassy.

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