Civil Service Federal Employees Federal Employees Federal Employees

Retirement Group Life Health Benefits Retirement

System Insurance Program System

United States

Office of

Personnel Management

The Federal Government’s Human Resources Agency

Retirement and Insurance Service

Financial Management Letter 

Number: F-00-06 Date : September 15, 2000

SUBJECT: ACCOUNTING FOR OFFSETS FROM PAY OF REEMPLOYED

ANNUITANTS

Through our efforts to reconcile our intragovernmental account balances with our partner

agencies, we have discovered inconsistencies in the way agencies account for “reemployed

annuitants." As a consequence, the task of reconciling intragovernmental account balances for

both OPM and our partners has become more difficult. The purpose of this letter is to provide

guidance in this regard.

A reemployed annuitant is a person who is receiving a Civil Service Retirement System (CSRS) or

Federal Employee Retirement System (FERS) retirement annuity and, at the same time, is earning

a paycheck as a Federal employee. In most circumstances, a reemployed annuitant will continue

to receive his/her retirement annuity during his/her period of reemployment. The law, however,

requires that the reemployed annuitant's pay be “offset” by the amount of his/her retirement

annuity. In other words, the amount of paycheck that the reemployed annuitant receives is

reduced (offset) by the amount of his/her retirement annuity. The amount that is offset from a

reemployed annuitant's pay must be remitted to OPM for credit to the Civil Service Retirement and

Disability Fund.

We have learned that some agencies are recognizing the amount offset from the pay of a

reemployed annuitant as an intragovernmental "G" transaction. As such, they charge the amount

offset to SGL account 6400G. This is not correct! 

The amount offset from the pay of a reemployed annuitant is not an intragovernmental

transaction. The reemployed annuitant, a private citizen and nonfederal party, is the one paying

the offset, and the employing agency is withholding the amount on behalf of the annuitant. The

offset amount is part of gross payroll, and all gross payroll should be charged to a

nongovernmental “N” account, most likely SGL account 6100N. Equally important, because it is

an “N” transaction, it must not be reported to OPM on the Confirmation of Intragovernmental

Account Balances nor as a “G” account to Treasury for FACTS purposes.
To illustrate the proper accounting for amounts offset from the pay of a reemployed annuitant,

assume the following about a reemployed annuitant:

Gross pay $4,000

To be offset and remitted to OPM 1,200

Basic pay after offset 2,800

Federal taxes withheld 800

Net pay $2,000

As of the end of the payroll period, the agency, which is employing the reemployed annuitant,

would post the following entry:

6100N Gross Payroll 4,000

2210N Due to OPM 1,200

2210N Net Pay 2,800

When the reemployed annuitant is paid, the agency would the following entry:

2210N Due to OPM 1,200

2210N Net Pay 2,800

1010 To Employee 2,000

1010 To OPM 1,200

1010 To IRS 800

If you have any questions about this matter, please direct them to 202-606-0606 or us at finance

@opm.gov.

Robert A. Yuran, Chief

Financial Policy Staff

Retirement and Insurance Service