(a) Whenever a beneficiary is incarcerated in a State or Federal
jail, prison, penal institution or other correctional facility due to a
State or Federal felony conviction, he or she forfeits all rights to
compensation benefits during the period of incarceration. A
beneficiary's right to compensation benefits for the period of his or
her incarceration is not restored after such incarceration ends, even
though payment of compensation benefits may resume.
(b) If the beneficiary has eligible dependents, OWCP will pay
compensation
to such dependents at a reduced rate during the period of his or her
incarceration, by applying the percentages of 5 U.S.C. 8133(a)(1)
through (5) to the beneficiary's gross current entitlement rather than
to the beneficiary's monthly pay.
(c) If OWCP's decision on entitlement is pending when the period of
incarceration begins, and compensation is due for a period of time prior
to such incarceration, payment for that period will only be made to the
beneficiary following his or her release.
