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The possibility of obtaining retirement benefits premised on your civil service is one perk of working for the federal government. As a general rule, military service in the United States Armed Forces is considered creditable for the purpose of federal retirement provided it was active service rendered before separation from civilian employment for retirement, ended under honorable conditions, and performed.
However, federal employees must typically forego military retiree pay to have their military service counted toward their federal annuity and qualify for the retirement annuity.
Military retirement benefits are determined by the branch of service, not your employer or Office of Personnel Management. They are based on a service-connected impairment sustained in the line of duty during a time of war or sustained during a battle with an American enemy.
Military retired pay obtained follows 10 U.S.C. 12731-12739 (Chapter 1223) provisions, which provides retirement pay to personnel of reserve components of the military services based on age and service (active personnel).
Military service is not taken into account when determining military retirement pay.
Get a retirement estimate with and without credits for your retired army service to see whether merging your retired military service alongside your civilian employment is advantageous. Next, ascertain the size of the military deposit. Once you know this, you can decide whether the deposit benefits you. Usually, a hiring company will carry out this calculation.
Fill out Form RI 20-97 (Expected Earnings Throughout Military Service), enclose a copy of your DD 214 or D.D. 214s indicating your army duty, and mail the completed form to the relevant military finance center indicated on the form. A completed RI 20-97 or a letter outlining your anticipated military pay will be returned by the center.
Request a Military Deposit Worksheet and a Military Deposit Application from your organization (OPM 1514). Fill out the employee section of the application, and submit it to the payroll office with your DD 214(s), the OPM 1514, the document or letter outlining your expected military wages, and the OPM 1514. When the amount of the deposit is determined, that office will get in touch with you to arrange for payment.
As soon as you’re prepared to retire, you should file a waiver of your military retired wage to the relevant military finance center 60 to 90 days before the start of your civilian retirement. If you choose not to forego your military retirement income, the OPM will return your deposit with interest if you are a FERS employee and without if you are a CSRS employee. You’ll then submit the proper refund application form with your retirement package.
If the deposit is paid early, less interest is charged. If you want to pay a deposit, you must finish it before retiring. Your military service won’t count toward civilian retirement if you don’t pay the deposit or elect not to renounce military retired pay.
M. Dutton and Associates is a full-service financial firm. We have been in business for over 30 years serving our community. Through comprehensive objective driven planning, we provide you with the research, analysis, and available options needed to guide you in implementing a sound plan for your retirement. We are committed to helping you achieve your goals. Visit us at MarvinDutton.com . Tel. 212-951-7376: email: [email protected].