How Does Civil Service Retirement Affect Social Security Benefits?

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20 percent of the 1.9 million federal employees will retire by 2014.
20 percent of the 1.9 million federal employees will retire by 2014. (Image: us capitol image by Ritu Jethani from Fotolia.com)

In 1920, the Civil Service Retirement Act created a retirement system for federal employees. The Federal Employees Retirement System replaced it effective January 1, 1987 for new employees. US Census data shows that as of 2006, there are 650,000 active employees still working under the CSR system.

Windfall Elimination Provision

Federal employees who stayed under the old Civil Service system in 1987 did not pay into Social Security. If the employee also worked under Social Security through other employment, his Social Security benefit will be smaller under the Windfall Elimination Provision. Under this provision, his Social Security benefit computation is different from the standard method and could reduce his benefit up to $380.50 monthly.

Government Pension Offset

If a Civil Service retiree is the spouse or surviving spouse -- or former spouse -- of an individual who worked under Social Security, she could become eligible for Social Security benefits as the wife or widow of the worker. The Government Pension Offset law affects these Social Security benefits. SSA will deduct two-thirds of her civil service pension from her Social Security benefit.

Federal Retiree Dies

Windfall Elimination Provision offsets end when the civil service retiree dies. Social Security calculates benefits due his survivors using the same rules that apply to all survivor benefits. Civil service survivor or dependent benefits do not affect any Social Security benefits to which the recipient may be eligible.

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