Federal Erroneous Retirement Coverage Corrections Act

Social Security

What about errors in Social Security coverage? Does FERCCA give me a choice about Social Security?

You may not have a choice about Social Security coverage.

If you should have had Social Security coverage during your Federal employment, then you must have Social Security coverage in addition to your Federal retirement coverage. FERCCA does not allow you to choose a retirement plan without Social Security coverage.

If you were incorrectly put in CSRS when you should have been put in CSRS Offset, your retirement coverage must be corrected to CSRS Offset.

Likewise, if you were incorrectly put in CSRS Offset when you should have been put in CSRS, your retirement coverage must be corrected to CSRS because you are not eligible for Social Security coverage during your Federal employment. You cannot choose to keep your Social Security coverage. However, Social Security will give you credit for all but the last 3 years before your record was corrected. See the question I should have been CSRS. Instead, I paid into Social Security. What happens to the Social Security taxes I paid when my agency corrects my retirement coverage to CSRS? for more information.

If you were erroneously put in FERS and should have been put in CSRS, then you will have a chance to choose whether you want to keep FERS (and Social Security) coverage.

I worked for a number of years during which I should have been paying into Social Security, but I only paid into CSRS. Can I get any Social Security credit for that work? And, if so, how much will it cost me?

You will get Social Security credit for all that work, and it won't cost you anything. Your agency will send the Social Security Administration a record of your earnings during all the years you should have had Social Security coverage. All of the CSRS contributions you made during those years that are not needed to cover your retirement costs will be transferred to Social Security. This transfer will pay all the Social Security taxes you owe.

I should have been CSRS. Instead, I paid into Social Security. What happens to the Social Security taxes I paid when my agency corrects my retirement coverage to CSRS?

Except for the last 3 years, the money you erroneously paid into Social Security will remain to your credit in the Social Security fund. The Social Security Administration will include all but those last 3 years in determining your eligibility for, and the amount of, future benefits.

The amount you paid into Social Security for the last 3 years will be transferred to your account in the Civil Service Retirement fund. Your employing agency will pay all additional retirement contributions owed for your CSRS time. It may not go back and bill you for additional retirement deductions when it corrects the error.

My agency corrected my records from CSRS to CSRS Offset. Wouldn't I have been better off if I could have stayed in CSRS?

Actually, you're probably better off in CSRS Offset because you're earning benefits under both Social Security and CSRS.

Your combined benefits under Social Security and CSRS Offset will be at least the same as, if not more than, what you would have received under Social Security and CSRS if your record had not been corrected.

While working, you are earning retirement credits under the relatively generous CSRS formula. You also are adding to any Social Security benefits you have already earned, increasing your career earnings under Social Security and, as a result, your Social Security benefit.

When you retire, OPM will compute your CSRS Offset benefit under the same rules that apply to other CSRS retirees. When you become eligible for Social Security benefits, OPM will reduce your benefit. This reduction is based on the value of the Social Security benefit you earned during your CSRS Offset service. In other words, instead of getting one check from OPM for all of your Federal service, some of the payment will come from the Social Security Administration.

In addition, with more of your retirement income paid from Social Security, you have an increased tax advantage because part, or all, of your Social Security benefit will be exempt from Federal income tax. Only a small portion of a CSRS, or CSRS Offset, benefit is excluded from Federal income tax.

How long do I need to work to become eligible for Social Security retirement benefits?

Everyone born in 1929 or later needs 40 credits to be eligible for Social Security retirement benefits. Since you can earn 4 credits per year, you need at least 10 years of work that subject to Social Security to become eligible for Social Security retirement benefits.

When you work in a job that is subject to Social Security, your wages are posted to your Social Security record and you receive earnings credits based on those wages. The Social Security Administration uses these credits to determine your eligibility for Social Security retirement benefits and for disability or survivors benefits if you should become disabled or die.

Each year, the amount of earnings needed for a credit rises as the average earnings levels rise. In 2001, you receive 1 credit for each $830 of earnings, up to the maximum of 4 credits per year.

What is the earliest age I can begin receiving Social Security retirement benefits?

The earliest a person can start receiving Social Security retirement benefits is age 62. Your Social Security retirement benefit is reduced if you begin receiving them before your full retirement age.

Full retirement age has been age 65 for many years. However, beginning with people born in 1938 or later, that age will gradually increase until it reaches 67 for people born after 1959.

Year of Birth	Full Retirement Age
1937 or earlier	65
1938	65 and 2 months
1939	65 and 4 months
1940	65 and 6 months
1941	65 and 8 months
1942	65 and 10 months
1943 - 1954	66
1955	66 and 2 months
1956	66 and 4 months
1957	66 and 6 months
1958	66 and 8 months
1959	66 and 10 months
1960 or later	67

How are my Social Security retirement benefits calculated?

Social Security benefits are based on earnings averaged over most of a worker's lifetime. Your actual earnings are first adjusted or "indexed" to account for changes in average wages since the year the earnings were received. Then the Social Security Administration calculates your average monthly indexed earnings during the 35 years in which you earned the most. The Social Security Administration applies a formula to these earnings and arrives at your basic benefit, or "primary insurance amount" (PIA). This is the amount you would receive at your full retirement age.

As you can see from the above, the benefit computation is complex and there are no simple tables that we can give you that will tell you how much you will receive. However, there are several ways you can find out how your Social Security retirement benefit is figured:

1. Request a Social Security Statement. You can make your request over the Internet and the Social Security Administration will mail you a detailed report of your lifetime earnings and an estimate of Social Security retirement, disability and dependent benefits: www.ssa.gov/statement.
2. Compute your own Social Security benefit estimate using a program that you can download from your PC: www.ssa.gov/OACT/ANYPIA/anypia.html.
3. How Your Retirement Benefit Is Figured is a publication that walks you through the formula for computing your retirement benefit: www.ssa.gov/pubs/10070.html.
4. See examples of how Social Security benefits are computed at www.socialsecurity.gov/OACT/ProgData/retirebenefit1.html.

Where can I get more information about Social Security benefits?

You can find more information about Social Security benefits at www.ssa.gov.

I retired under CSRS, which is the correct retirement coverage for me. Why am I affected by Government Pension Offset?

The Government Pension Offset is part of the Social Security Law that reduces spouse or survivor Social Security benefits for certain individuals who are also entitled to a Federal Government pension. If you retire from the Federal service under CSRS and are also eligible for Social Security benefits as a spouse, former spouse or survivor, your Social Security benefit will be reduced. It is reduced because you are receiving a pension from the Federal Government based on earnings that are not covered by Social Security. For every $3 you receive from your CSRS annuity, your Social Security spousal benefit is reduced by $2. For more information, see SSA's publication, Government Pension Offset at http://www.ssa.gov/pubs/10007.html.

Is the Windfall Elimination Provision the same as Government Pension Offset?

No. The Social Security Law also includes a provision -- the Windfall Elimination Provision (WEP) -- that reduces Social Security benefits for individuals who have less than 30 years of "substantial earnings" under Social Security and who have earned a retirement benefit from employment not covered by Social Security; for example, CSRS service. The WEP was designed to eliminate the "windfall" that could result if you were to receive a CSRS annuity based on many years of employment not covered by Social Security and also receive a full Social Security benefit because you had a few years of employment covered under Social Security. The WEP, however, never totally eliminates the Social Security benefit you have earned. For example, in 2001, the maximum amount the WEP can decrease a Social Security benefit is $280.50 per month. For more information, see SSA's The Windfall Elimination Provision at http://www.ssa.gov/pubs/10045.html.

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