by clicking on the page. A slider will appear, allowing you to adjust your zoom level. Return to the original size by clicking on the page again.
the page around when zoomed in by dragging it.
the zoom using the slider on the top right.
by clicking on the zoomed-in page.
by entering text in the search field and click on "In This Issue" or "All Issues" to search the current issue or the archive of back issues respectively.
by clicking on thumbnails to select pages, and then press the print button.
this publication and page.
displays a table of sections with thumbnails and descriptions.
displays thumbnails of every page in the issue. Click on a page to jump.
allows you to browse through every available issue.
Federal Employees News Digest : July 15, 2013
O ne decision a retiring federal employee must make at the time of retirement is whether or not to give a survivor annuity benefit to one individual. This first of six columns discussing survivor benefits discusses the survivor annuity benefit options for a current and/or former spouse of an employee covered by the Civil Service Retirement System. Retiring CSRS employees may make one of three spousal survivor benefit elections when they fill out their retirement application, form SF 2801: (1) self-only annuity with no spousal survivor benefits; (2) partially reduced annuity for a less than maximum spousal sur- vivor benefit; or (3) fully reduced annuity resulting in the maximum spousal survivor benefit. The survivor benefit election may be used to pro- vide one of the following types of benefits: (1) current spouse survivor annuity (full or partial survivor benefits); (2) former spouse survivor annuity (full or partial survivor benefits); or (3) a combination of (1) and (2). If a CSRS-covered employee is married at the time of retirement and does not wish to provide the maximum current spouse survi- vor annuity, then the employee must obtain their spouse's written consent. Spousal consent is given on form SF 2801-2, Spouse's Consent to Survivor Election. Office of Personnel Management regulations require that spousal consent be given by completing the OPM consent form before a notary public or other official autho- rized to take oaths. A spousal survivor annuity is payable to the spouse of a deceased annuitant only if the annuitant elected a reduced annuity on Form SF 2801 to provide the survivor benefit. To qualify as a surviving spouse of a deceased annuitant, the individual must be married to the annuitant at the time of the annuitant's death and must meet one of the following requirements: (1) the surviving spouse and the deceased annuitant must have been married for at least nine months; or (2) a child was born of the marriage. This includes a child born posthumously to the deceased annuitant and spouse, a child born to the deceased annuitant and spouse before they were married, and a child of a prior marriage between the deceased annuitant and spouse. A court order awarding a former spouse a survivor annuity prevents OPM from paying the current surviving spouse the por- tion of the survivor annuity awarded by the court order. But the current surviving spouse---if otherwise eligible---remains eligible for a complete survivor annuity when the former spouse loses eligibility. Even when no survivor annuity benefits are currently payable to the surviving spouse because of the court- ordered entitlement to the former spouse, the sur- viving spouse is entitled to Federal Employee Health Benefits (FEHB) coverage. The maximum survivor annuity is 55 percent of the deceased annuitant's annuity before it is reduced by the cost of the survivor benefit (the unreduced annuity). The survivor annuity will be approximately 60 percent of the deceased annuitant's net annuity at the time of death, as the following example illustrates: George's CSRS gross annuity at the time of retirement is $60,000/year. To give his wife Pam the maximum sur- vivor annuity benefit, George's annuity will be reduced by: (2.5 percent of $3,600) plus (10 percent of $60,000 less $3,600), or $90 plus $5,640, which equals $5,730. George's net annuity is $60,000 less $5,730, or $54,270 per year. If George were to die six months after he retired, then Pam would receive 55 percent of $60,000, or $33,000 per year, which is 60.8 percent of George's net annuity of $54,270. Every cost-of-living adjustment (COLA) an annuitant receives will increase the survivor annuity by the same percentage. Once computed, the cost for giving a survivor annuity does not change, however, as illustrated in the following example: After 10 years of retirement and annual COLAs, George's original $60,000 CSRS gross annuity has increased to $70,000. At that time, George's net annuity after subtracting the cost of the survivor annu- ity benefit will be $70,000 less $5,730 (same as before), or $64,270. If George were to die at that time, Pam's CSRS survivor annuity will be 55 percent of $70,000, or $38,500. The CSRS survivor annuity benefit can be changed after an employee retires under the following rules: (1) an annuitant can revoke or change a survivor election within 30 days of the first monthly annuity payment; after 30 days, an annuitant may not reduce the survivor benefit elected; or (2) an annuitant may request in writing within 18 months of retirement to cancel a waiver of the survivor benefit or to increase a current spouse's benefit election. Note that there will be a substantial penalty for a post-retirement election to increase the election made at retirement. The CSRS survivor annuity payable to a spouse begins on the day after the death of the annuitant and ends on the last day of the month preceding the month in which the survivor annuitant dies or remarries before age 55. But if the survivor annuitant remarries before age 55 and was married at least 30 years to the individual on whose service the annuity is based, then the CSRS survivor annuity will not be terminated. Edward A. Zurndorfer is a Certified Financial Planner and Enrolled Agent in Silver Spring, MD. He is also a registered representative with FSC Securities Corporation, branch address: 833 Bromley St. - Suite A, Silver Spring, MD 20902. Phone: (301) 681-1652. Securities offered through FSC Securities Corporation,member FINRA/SIPC. EZ Accounting and Financial Services and FSC are independent companies. Informed Investor Deciding on survivor annuity benefits Part I: CSRS July 15, 2013 Vol. 62, No. 50 7 Visit us on the Internet at www.FederalDaily.com
July 8, 2013
July 22, 2013