FERSGUIDE

1 The FERSGUIDE Retirement Benefits Guide for fers Employees and Annuitants 2018 Edition (updated ) The foregoing is not considered legal or financial advice. It is intended to inform and motivate you to seek out this information on your own and make sure that it is correct and suits your needs. 2017 FERSGUIDE , LLC. 2018 REGULAR Page 2 of 130 FERSGUIDE fers Employees and Annuitants Thank you for reading the FERSGUIDE . I ve provided this in-depth comprehensive retirement-benefits guide for over 20 years and have answered thousands of questions from subscribers.

2 This guide has always been a labor of love for me, something that I passionately enjoy and believe in. To that end, this year I expanded it again, adding 16 pages; with the guide now at 130 pages and with additional hyperlinks and examples. My gratitude to Bob White for authoring and updating the Social Security and Medicare section of the guide. Beginning in December 2014, I started charging for the FERSGUIDE (via PDF on my website) and accompanying subscription to the FERSGUIDE website. You can purchase your copy for $15 at by subscribing to the website.

3 If you have a copy of this publication, and you are not a paid FERSGUIDE subscriber, please consider visiting the website and becoming a subscriber, as the guide is no longer a free resource. I ve tried to make the cost reasonable in order to encourage subscription participation. Purchasing the FERSGUIDE is as simple as clicking the JOIN NOW banner on the website and using your credit card. During the payment process, you will create a username and password, and these credentials will allow you to log into the website and download the FERSGUIDE in PDF format and unlock other website content, including PowerPoints and other resources.

4 If you are not comfortable using your credit card on the Internet, just drop a check in the mail to FERSGUIDE , LLC, to the address on the website homepage and I ll enter your subscription for you (be sure to include your email address). Your 2018 subscription will entitle you to updates of the 2018 guide throughout the guide-year (which ends on 11/30/2018), monthly newsletters and the opportunity to ask questions of me. I only answer questions now that come from paid subscribers. It remains my goal to educate new fers employees about retirement benefits so that they will be well-prepared and able to retire sooner than originally planned.

5 New employees can receive their first-year subscription for free just email with your request and provide your name and EOD date. Warm regards, Dan Jamison, CPA FERSGUIDE , LLC The foregoing is not considered legal or financial advice. It is intended to inform and motivate you to seek out this information on your own and make sure that it is correct and suits your needs. 2017 FERSGUIDE , LLC. 2018 REGULAR Page 3 of 130 FERSGUIDE fers Employees and Annuitants 2018 Edition ( ) Table of Contents Click on the Subject I.

6 What Are the Major Federal Tax Law Changes for the 2018 Tax Year? 7 II. fers annuity Benefits 8 A. Proposed Reductions to Federal Retirement Benefits 8 B. What Benefits Can I Expect to Receive When I Retire? 10 C. What Is the fers Basic annuity ? 11 D. What If I Exceed the Biweekly GS Pay Cap? 12 E. Can I Purchase Military and Civilian Service Credit? 14 1. Military Service Deposits 14 2. USERRA Uniformed Services Employment and Reemployment Rights Act 15 3. Civilian Service Deposits 16 F. What Is the fers retiree annuity supplement (RAS)?

7 17 G. When Am I Eligible to Retire? 22 H. Unused Sick Leave and Service Credit Calculation 24 I. What If I Was Part Time during Part of My Career? 26 J. Will I Receive a Cost-of-Living-Adjustment (COLA) on My fers Basic annuity ? 27 K. Should I Select a Spousal Benefit Survivor annuity (SBSA) When I Retire? 27 L. Phased Retirement 29 M. What Happens If I Die before I Am Eligible for Retirement? 30 N. Do My Minor Children Receive Any Benefits When I Die as an Annuitant? 31 O. What Happens If I Am Reemployed by the Federal Government? 32 P.

8 Disability Retirement 33 Q. Foreign Service Pension System (FSPS) 39 R. Are There Other Federal Pension Plans? 40 The foregoing is not considered legal or financial advice. It is intended to inform and motivate you to seek out this information on your own and make sure that it is correct and suits your needs. 2017 FERSGUIDE , LLC. 2018 REGULAR Page 4 of 130 III. Thrift Savings Plan 41 A. What s the Latest News regarding the TSP? 41 B. The TSP 2017-2021 Strategic Plan 41 C. How Important Is It for Me to Contribute to the TSP? 43 D.

9 What Should My 2018 TSP Contribution Be? 44 E. When Can I Start the $6,000 Catch-Up Contribution to the TSP? 46 F. Can I Transfer Other Retirement Funds into the TSP? 47 G. Hardship Withdrawal Considerations 48 H. TSP Loans 48 I. What If I Have an Outstanding TSP Loan at Retirement? 49 J. What Are the Details of the Roth TSP Option? 49 K. HUGE Roth TSP Pitfall 52 L. How Much Can I Contribute to the TSP in the Year I Retire? 54 M. When Can I Withdraw TSP Funds without the 10% Penalty? 54 N. What Are My TSP Withdrawal Options When I Retire?

10 55 O. Withdrawal Considerations for Tax Purposes 56 P. Where Can I Get Help Managing My TSP Account? 57 Q. Death Benefits and the TSP 58 R. The TSP Is Not Insured for Fraud Losses 59 S. I Can't Afford To Contribute the Maximum to the TSP! 59 T. Savings Ideas to Help Fund Your TSP 60 IV. General Retirement Issues 63 A. I m Getting Divorced What Happens to My Retirement Benefits? 63 1. Federal Law vs. State Law: 63 2. Federal Pension Plans vs. State, Municipal and Private-Sector Plans: 63 3. fers annuity Division in Divorce: 65 4. OPM s Recent Policy Change on the retiree annuity supplement : 66 5.