CSRS Deferred Retirement FERS i 

Chapter 45
 

Table of Contents 

Subchapter 45A CSRS 

Part 45A1 General Information 

Section 45A1.1-1 Overview .......................................... 1
 

A. Introduction .................................................. 1
 

B. Topics Covered ................................................ 1
 

C. Organization of Subchapter ........................................ 2
 

D. Statement of Authority ........................................... 2
 

Section 45A1.1-2 Eligibility Requirements ............................... 3
 

A. General ..................................................... 3
 

B. Not Eligible for an Immediate Annuity ................................. 3
 

C. Minimum Civilian Service ......................................... 3
 

D. All Deductions Refunded .......................................... 4
 

E. "One-Out-of-Two" Requirement ..................................... 4
 

F. Alternative Annuity Election ....................................... 5
 

Part 45A2 Procedures 

Section 45A2.1-1 Procedures ........................................ 6
 

A. Agency Responsibility ........................................... 6
 

B. Applicant Responsibility .......................................... 6
 

Section 45A2.1-2 Advice To Employee .................................. 7
 

A. Basis of Deferred Annuity ......................................... 7
 

B. Post-1956 Military Deposits ........................................ 7
 

C. Commencing Date of Annuity ...................................... 7
 

D. Survivor Benefits ............................................... 7
 

E. Refunds ..................................................... 7
 

F. Alternative Annuity ............................................. 8
 

CSRS and FERS Handbook April, 1998 
ii CSRS Deferred Retirement FERS 

Chapter 45
 

Subchapter 45B FERS 

Part 45B1 General Information 

Section 45B1.1-1 Overview .......................................... 9
 

A. Introduction .................................................. 9
 

B. Organization of Subchapter ........................................ 9
 

C. Statement of Authority ........................................... 9
 

Section 45B1.1-2 Eligibility Requirements ................................ 10
 

A. General ..................................................... 10
 

B. Minimum Civilian Service ......................................... 10
 

C. Noncreditable Civilian Service ...................................... 11
 

D. Minimum Retirement Age (MRA) .................................... 12
 

E. Age and Service Requirement ....................................... 12
 

Section 45B1.1-3 Reduction for Retirement Before Age 62 ..................... 13
 

A. General Rule ................................................. 13
 

B. Exceptions ................................................... 13
 

C. Transferee with a CSRS Annuity Component ............................. 14
 

D. Special Groups ................................................ 14
 

Part 45B2 Procedures 

Section 45B2.1-1 Procedures ......................................... 15
 

A. Agency Responsibility ........................................... 15
 

B. Applicant Responsibility .......................................... 15
 

Section 45B2.1-2 Advice to Employee ................................... 16
 

A. Applicable CSRS Provision ........................................ 16
 

B. Commencing Date of Annuity ...................................... 16
 

C. Survivor Benefits ............................................... 16
 

D. Refunds ..................................................... 17
 

E. Retiree Annuity Supplement ........................................ 17
 

Subchapter 45C Job Aids and Forms 

Section 45C1.1-1 Information Aids .................................... 19
 

Retirement and Insurance Information for Separating CSRS or CSRS Offset

Retirement and Insurance Information for FERS Employees

 Employees Who Are Not Eligible for an Immediate Annuity .................... 20
 

 Who Are Not Eligible for an Immediate Annuity ........................... 24
 

April, 1998 CSRS and FERS Handbook 
 CSRS Deferred Retirement 

Chapter 45 

1 

Subchapter 45A CSRS 

Part 45A1 General Information 

Section 45A1.1-1 Overview 

A.	 Introduction This subchapter covers deferred retirements. A deferred retirement annuity 

may be payable at a future date to an employee who separates from a 

position subject to CSRS or transfers to a position not covered by the 

retirement system before qualifying for an immediate annuity. 

For information about immediate CSRS retirements, see the following 

chapters: 

•	 Chapter 41, Voluntary Retirement Based on Age and Service; 

•	 Chapter 43, Early Voluntary Retirement, for retirement under an 

OPM-approved major RIF, reorganization, or transfer of function; 

•	 Chapter 44, Discontinued Service Retirement; 

•	 Chapter 46, Special Retirement Provisions for Law Enforcement 

Officers, Firefighters, and Air Traffic Controllers. 

B. Topics Covered	 This subchapter covers: 

•	 CSRS eligibility requirements for a deferred annuity; 

•	 The procedures the employing office must follow at time of separation 

for employees who are eligible for a deferred annuity; 

•	 The advice that the employing office should give to a separating 

employee about deferred retirement. 

CSRS and FERS Handbook	 April, 1998 
2 CSRS Deferred Retirement 

Chapter 45 

Section 45A1.1-1 Overview (Cont.) 

C. Organization of The CSRS subchapter has two parts: 

Subchapter 

Part Name of Part Page 

45A1 General Information 1 

45A2 Procedures 6 

NOTE: Subchapter 45B about deferred retirement under FERS begins on 

page 9. 

D.	 Statement of This subchapter is based on the laws and regulations cited below. 

Authority 

•	 United States Code: 5 U.S.C. 8333 and 8338 

•	 Public Law 103-66, section 11002 

•	 Code of Federal Regulations: 5 CFR Part 831 

April, 1998	 CSRS and FERS Handbook 
 CSRS	 Deferred Retirement 3 

Chapter 45 

Section 45A1.1-2 Eligibility Requirements 

A.	 General An employee who separates from service or transfers to a position that is 

not covered by the retirement system is entitled to a deferred annuity 

commencing at age 62 if he or she: 

•	 Is not eligible for an immediate annuity within 1 month of separation; 

•	 Meets the minimum civilian service requirement; 

•	 Does not take a refund of retirement deductions after separating from 

service (or transferring to a noncovered position); and 

•	 Meets the "1-out-of-2" requirement. 

B. Not Eligible for A separated employee who meets all of the requirements for an immediate 

an Immediate annuity is not eligible for a deferred annuity. 

Annuity 

EXAMPLE: Bob is age 60 and has 20 consecutive years of creditable 

service. He meets the eligibility requirements for a voluntary retirement 

under CSRS. Consequently, he does not have the option of separating from 

Federal service and electing to receive a deferred annuity. Even if Bob 

delays filing an application for retirement, OPM will pay the annuity 

retroactively to the effective date of Bob's immediate annuity upon receipt 

of his application. 

C.	 Minimum A former employee must have completed at least 5 years of creditable 

Civilian Service civilian service to be eligible for a deferred retirement. 

Creditable civilian service for this purpose includes: 

•	 Service for which full CSRS deductions were taken, even if CSRS 

deductions were refunded and not redeposited, except as provided in 

paragraphs D and E below; 

•	 CSRS Interim or Offset service for which full Social Security taxes and 

reduced CSRS deductions were taken, even if CSRS deductions were 

refunded and not redeposited, except as provided in paragraphs D and 

E below; and 

•	 Nondeduction service (that is, temporary or intermittent service), 

whether or not a deposit for such service is made. 

NOTE 1:	 Accrued and unused sick leave to an employee's credit at date 

of separation is not creditable for eligibility or computation 

purposes in a deferred retirement. 

CSRS and FERS Handbook	 April, 1998 
4 CSRS Deferred Retirement 

Chapter 45 

Section 45A1.1-2 Eligibility Requirements (Cont.) 

C.	 Minimum 

Civilian Service 

(Cont.) 

D.	 All Deductions 

Refunded 

NOTE 2: See Chapter 20, Creditable Service, for a full description of 

creditable service. 

A former employee is not eligible for a deferred annuity if he or she has 

received a refund of all retirement deductions. 

EXAMPLE: Debbie was appointed to a career position May 1, 1967. 

She separated on April 30, 1972, and did not receive a refund of her 

retirement contributions. She returned to Federal service November 1, 

1975, and separated October 31, 1985. At that time she received a refund 

covering both periods of service. When Debbie reaches age 62, she will 

not be eligible for a deferred annuity because she received a refund of all 

retirement contributions after separating from her last period of Federal 

service. 

E.	 "One-Out-ofTwo" 

Requirement 

The former employee must have been employed under the retirement 

system for at least 1 year within the 2-year period immediately preceding 

the separation on which the deferred annuity is based. 

EXAMPLE: Patricia was appointed to a career position with CSRS 

coverage October 1, 1960. She separated September 30, 1970. She 

returned to a covered position in January 1980 and separated again in June 

1980. Patricia did not receive a refund of her retirement contributions after 

either separation. 

When Patricia reaches age 62, she will be eligible for a deferred annuity 

based only on the period of service between October 1, 1960, and 

September 30, 1970. The period between January 1980 and June 1980 will 

not be included in the computation of the deferred annuity because Patricia 

did not meet the "1-out-of-2" requirement with respect to this service. 

Patricia could apply for and receive a refund of the deductions for this 1980 

service at any time, or leave the money in her account in case she has 

subsequent Federal service that meets the "1-out-of-2" requirement. (An 

application for a partial refund must be clearly labeled to preclude payment 

of the total refund and inadvertent loss of entitlement to future benefits. 

See Chapter 32, Refunds, section 32A1.1-10, paragraph A.) If, at the time 

she applies for a deferred annuity, the deductions for the 1980 service are 

still in her account, OPM will automatically refund them to her as part of 

the adjudication process. No interest is payable since she has a total of 

more than 5 years of civilian service. 

April, 1998	 CSRS and FERS Handbook 
 CSRS Deferred Retirement 5 

Chapter 45 

Section 45A1.1-2 Eligibility Requirements (Cont.) 

F. Alternative Public Law 103-66, the Omnibus Budget Reconciliation Act of 1993 

Annuity Election (OBRA), approved August 10, 1993, eliminated the alternative form of 

annuity (AFA) for most retirees, effective October 1, 1994. An employee 

eligible for a deferred annuity that commences on or after October 1, 1994, 

may not elect the alternative form of annuity unless the employee has, at the 

time the deferred annuity commences, a life-threatening affliction or other 

critical medical condition currently listed in 5 CFR 831.2207. 

CSRS and FERS Handbook April, 1998 
6 CSRS Deferred Retirement 

Chapter 45 

Part 45A2 Procedures 

Section 45A2.1-1 Procedures 

A.	 Agency When an employee who is not entitled to an immediate annuity separates, 

Responsibility the employing office must: 

1.	 Close out the employee's SF 2806, Individual Retirement Record, and 

forward it to OPM according to instructions provided in Chapter 81, 

The Individual Retirement Record and Register of Separations and 

Transfers. 

2.	 Complete SF 2810, Notice of Change in Health Benefits Enrollment, 

and SF 2821, Agency Certification of Insurance Status, to terminate 

Federal health benefits enrollment and life insurance coverage. 

3.	 Provide the employee with the pamphlet entitled "Retirement and 

Insurance Information for Separating CSRS or CSRS Offset Employees 

Who Are Not Eligible for Immediate Annuity" (Retirement Facts 11, 

RI 83-13). 

4.	 If the employee wishes to apply for a refund of his or her retirement 

contributions, follow the procedures in Chapter 32, Refunds. 

B.	 Applicant The applicant must: 

Responsibility 

1.	 Request an Application for Deferred Retirement (SF 1496A) from 

OPM about 2 months before reaching age 62. The application may be 

obtained from OPM at the following address: 

Office of Personnel Management 

Civil Service Retirement System 

Retirement Operations Center 

Boyers, PA 16017 

The request must include the former employee's name, date of birth, 

Social Security number, the agency with which he or she was last 

employed, and the date of separation. If the former employee used any 

other name, such as a maiden name, while employed with the Federal 

government, that name also should be included. 

2.	 Complete the application and return it to OPM no earlier than 2 

months before he or she attains age 62. 

April, 1998	 CSRS and FERS Handbook 
 CSRS	 Deferred Retirement 7 

Chapter 45 

Section 45A2.1-2 Advice To Employee 

A.	 Basis of Deferred A deferred annuity is based on the length of service and average salary in 

Annuity	 effect at the time of separation. In the years between the date of separation 

and age 62, the average salary is not adjusted by any intervening cost-ofliving adjustments (COLA'S). 

B.	 Post-1956 Employees who want to make a deposit for post-1956 military service must 

Military Deposits	 make the deposit before separation in order to receive credit for the military 

service in the computation of the deferred annuity. See Chapter 23, Service 

Credit Payments for Post-56 Military Service, for instructions on how to 

make post-1956 military deposits. 

NOTE:	 Military service is not used to meet the 5-year minimum civilian 

service requirement described in section 45A1.1-2, paragraph C. 

C.	 Commencing Deferred annuities commence on the former employee's 62nd birthday. 

Date of Annuity 

D.	 Survivor Benefits No survivor annuity is payable to a former employee's spouse, former 

spouse, or children if the former employee has title to a deferred annuity 

but dies before attaining age 62. The same is true if the former employee 

attains age 62, but dies before filing an application for retirement. The only 

benefit payable in either case would be a lump-sum payment of the former 

employee's retirement contributions, without interest. (Exception: if the 

former employee had pre-1957 service from which retirement deductions 

were withheld from his or her salary and not previously refunded, interest 

will be payable through 12-31-56.) 

E.	 Refunds Receipt of a refund at separation voids entitlement to a deferred annuity. A 

former employee who takes a refund may redeposit the refund (with 

interest) if he or she is subsequently reemployed in the Federal service 

under CSRS or FERS. 

A former employee who returns to work and then separates with title to a 

deferred annuity may, without returning once again to Federal service, 

make a redeposit of a refund or refunds taken after any earlier separation. 

However, the redeposit must be made before OPM finishes processing the 

individual's claim for a deferred annuity. 

CSRS and FERS Handbook	 April, 1998 
8 CSRS	 Deferred Retirement 

Chapter 45 

Section 45A2.1-2 Advice To Employee (Cont.) 

E.	 Refunds (Cont.) EXCEPTION: If the former employee received a refund covering a period 

of service that ended before October 1, 1990, he or she will 

not have to pay the redeposit to receive credit for that 

service. Instead, full credit for the refunded service will be 

allowed in computing the deferred annuity, but the annuity 

will be actuarially reduced. 

OPM will, however, offer the individual the opportunity to 

pay the redeposit to avoid the actuarial reduction before 

completing processing of the claim for deferred annuity. 

F. Alternative Subject to the restrictions imposed by Public Law 103-66 that are described 

Annuity	 in section 45A1.1-2, paragraph F, former employees who suffer from 

certain life-threatening illnesses and are entitled to a deferred annuity that 

commences on or after October 1, 1994, may elect the alternative annuity, 

including having any deposits or redeposits deemed paid. See Chapter 53, 

Alternative Annuity Elections, for additional information. 

April, 1998	 CSRS and FERS Handbook 
Deferred Retirement FERS 9 

Chapter 45 

Subchapter 45B FERS 

Part 45B1 General Information 

Section 45B1.1-1 Overview 

A.	 Introduction Subchapter 45B outlines the rules and policies that apply to deferred 

retirement under the Federal Employees Retirement System (FERS). 

This subchapter explains how FERS differs from CSRS. It refers readers to 

the CSRS rules that apply, or gives the FERS rule if it is different. 

For information about postponed immediate annuity benefits under the 

FERS "MRA + 10" provision, see Chapter 42, MRA + 10 Retirement. 

B.	 Organization of The FERS subchapter has two parts: 

Subchapter 

Part Name of Part Page 

45B1 General Information 9 

45B2 Procedures 15 

C.	 Statement of This subchapter is based on the laws and regulations cited below. 

Authority 

•	 United States Code: 5 U.S.C. 8410, 8413, and 8464 

•	 Code of Federal Regulations: 5 CFR Parts 841 and 842 

CSRS and FERS Handbook	 April, 1998 
10 Deferred Retirement	 FERS 

Chapter 45 

Section 45B1.1-2 Eligibility Requirements 

A.	 General A former employee is eligible to receive a deferred retirement annuity if he 

or she: 

•	 Is not eligible for an immediate annuity within one month of 

separation; 

•	 Meets the minimum civilian service requirement; 

•	 Does not take a refund of retirement deductions after separating from 

service (or transferring to a noncovered position); and 

•	 Is age 62 with at least 5 years of creditable service or the Minimum 

Retirement Age (MRA) with at least 10 years creditable service. 

NOTE:	 There is no "1-out-of-2" requirement under FERS as there 

is under CSRS. Thus, an employee who utilizes an 

opportunity to elect to transfer to FERS does not have to be 

under FERS for 1 year to be eligible for a deferred annuity. 

Likewise, an employee who is under FERS can retire at 

any time after being reemployed if he or she has the 

required age and service. 

B.	 Minimum A former employee must have at least 5 years of creditable civilian service 

Civilian Service to be eligible for a deferred retirement. 

Creditable civilian service for this purpose includes: 

•	 Service for which full FERS deductions were made and not refunded; 

•	 Nondeduction service (that is, temporary or intermittent service) 

performed prior to January 1, 1989, if a deposit for such service was 

made before separation; 

NOTE:	 Since service is not creditable under FERS unless it is paid 

for, a former employee must have 5 years of paid service at 

the time of separation to have title to a deferred annuity. 

A deposit payment to obtain title at the time of application 

is not permitted. If he or she has 5 years of paid service, 

then any additional unpaid service can be paid while OPM 

is processing the annuity application or be deemed paid 

under the alternative annuity provisions. 

April, 1998	 CSRS and FERS Handbook 
Deferred Retirement FERS 11 

Chapter 45 

Section 45B1.1-2 Eligibility Requirements (Cont.) 

B.	 Minimum • Service for which full Social Security taxes and full or reduced CSRS 

Civilian Service deductions were taken, if the CSRS deductions were not refunded; and 

(Cont.) 

For individuals eligible for a CSRS annuity component: 

•	 Nondeduction service (that is, temporary or intermittent service) 

subject to CSRS retirement computation rules, whether or not a deposit 

for such service is made or is deemed made under the alternative 

annuity provisions; 

•	 Service for which full CSRS deductions were taken, even if CSRS 

deductions were refunded and not redeposited. 

NOTE:	 See Chapter 20 for a full description of creditable civilian 

service. 

C.	 Noncreditable The following types of service performed under FERS may not be used in 

Civilian Service meeting the 5-year minimum service requirement: 

•	 Service performed under FERS for which a refund of FERS deductions 

was taken; 

•	 Service subject to FERS computation rules for which a refund was 

made after FERS coverage began; 

•	 Any period of nondeduction service performed before 1989 for which 

service credit payments were not completed before separation from 

service, unless the service is included in a CSRS component; 

•	 Nondeduction service (that is, temporary or intermittent service) 

performed on or after January 1, 1989, unless the service is included in 

a CSRS component. 

NOTE:	 Accrued and unused sick leave to the employee's credit at 

date of separation is not creditable for any purpose in a 

deferred retirement, even if the former employee is entitled 

to a CSRS annuity component. 

CSRS and FERS Handbook	 April, 1998 
12 Deferred Retirement FERS 

Chapter 45 

Section 45B1.1-2 Eligibility Requirements (Cont.) 

D. Minimum Depending on the former employee's year of birth, the MRA ranges 

Retirement Age between ages 55 and 57. To determine the MRA, refer to the table below:

(MRA) 

If Year of Birth Is... The Minimum Retirement

 Age Is... 

Before 1948 

1948 

1949 

1950 

1951 

1952 

1953-1964 

1965 

1966 

1967 

1968 

1969 

1970 & After 

55 

55 and 2 months 

55 and 4 months 

55 and 6 months 

55 and 8 months 

55 and 10 months 

56 

56 and 2 months 

56 and 4 months 

56 and 6 months 

56 and 8 months 

56 and 10 months 

57 

E. Age and Service
 

Requirement
 

Like former CSRS employees, former employees covered by FERS are 

eligible for a deferred annuity at age 62 if they have at least 5 years of 

creditable civilian service. 

In addition, former FERS employees are eligible for a deferred annuity as 

early as their MRA if they have 10 or more years of creditable service, 

including 5 years of civilian service. 

April, 1998 CSRS and FERS Handbook 
Deferred Retirement	 FERS 13 

Chapter 45 

Section 45B1.1-3 Reduction for Retirement Before Age 62 

A.	 General Rule A deferred annuity is reduced by five-twelfths of 1 percent for each full 

month by which the commencing date of annuity precedes the 62nd birthday 

of the employee. The reduction is 5 percent for each full year the employee 

is under age 62. 

EXAMPLE: Ed is a FERS employee who separates from service in the 

year 2000. At time of separation, Ed is age 37 and has 15 years of 

creditable service. His high-3 average salary at separation is $35,000. He 

may first apply for a deferred annuity at age 56, his MRA. 

The unreduced annual annuity is $5,250 [$35,000 (high-3) x 15 percent (1 

percent for each year of FERS service)]. Ed will not be 62 for 6 years, so 

the reduction is $1,575 (6 years x 5 percent = 30 percent). The annuity 

payable to Ed at age 56 is $5,250 minus $1,575, or $3,675. 

NOTE:	 The former employee may postpone the commencing date of the 

annuity to avoid or decrease the reduction (see paragraph B 

below). 

B. Exceptions	 The annuity is not reduced if the employee: 

•	 Completed at least 30 years of service. (The unreduced annuity can 

begin as early as the first of the month following the employee's 

attainment of the MRA); or 

•	 Completed at least 20 years of service and postponed the annuity 

commencing date until age 60; or 

•	 Completed at least 10 years of service and postponed the annuity 

commencing date until age 62. 

EXAMPLE: Judith is a FERS employee who separates from service in 

the year 2000. At time of separation, Judith is age 41 and has 20 years of 

creditable service. Her high-3 average salary at separation is $35,000. If 

she postpones the commencing date of her deferred annuity until she 

reaches age 60, the annuity will not be reduced for age. 

The unreduced annual annuity payable at age 60 is $7,000 [$35,000 (high x 

3) x 20 percent (that is, 1 percent for each year of FERS service)]. 

CSRS and FERS Handbook	 April, 1998 
14 Deferred Retirement FERS 

Chapter 45
 

Section 45B1.1-3 Reduction for Retirement Before Age 62 (Cont.)
 

C. Transferee with a 

CSRS Annuity 

Component 

In the case of a transferee who separates with a CSRS annuity component 

and who meets the eligibility requirement for a reduced deferred annuity, 

the reduction for each year the individual is under age 62 is applied to both 

the CSRS and FERS annuity components. 

EXAMPLE: Mary transferred to FERS July 5, 1987. At time of 

transfer, she had 10 years of CSRS service. Mary worked 10 more years 

under FERS and separated from service July 4, 1997, at age 50. At time of 

separation, her high-3 average salary was $50,000. She may receive a 

reduced deferred annuity at age 55, or an unreduced annuity at age 60. 

The unreduced annual annuity is $8,125 [$50,000 (high-3) x 16.25 percent 

(CSRS factor for 10 years of service)] PLUS $5,000 [$50,000 (high-3) x 10 

percent (FERS factor for 10 years of service)] for a total of $13,125. Mary 

will not be 62 for 7 years, so the reduction is $4,593.75 (7 years x 5 

percent = 35 percent). The annuity payable to Mary at age 55 is $13,125 

minus $4,593.75 or $8,531.25. 

NOTE: The CSRS component will receive CSRS COLA's; the FERS 

component will receive FERS COLA's beginning at age 62. (For 

additional information, see Chapter 2, Cost-of-Living 

Adjustments.) 

D. Special Groups Law enforcement officers, firefighters, air traffic controllers, and Members 

of Congress who separate from service subject to FERS for reasons other 

than misconduct with 20 years of service as a law enforcement officer, 

firefighter, air traffic controller, or Member may receive a deferred annuity 

at the MRA with no reduction for age. See Chapter 46, Special Retirement 

Provisions for Law Enforcement Officers, Firefighters, and Air Traffic 

Controllers, for further details. 

April, 1998 CSRS and FERS Handbook 
Deferred Retirement 

Chapter 45 

FERS 15 

Part 45B2 Procedures 

Section 45B2.1-1 Procedures 

A.	 Agency The employing office must follow the procedures outlined in section 

Responsibility	 45A2.1-1, paragraph A, for closing out the employee's record, with the 

following exceptions: 

1.	 The Individual Retirement Record is SF 3100 or 3100A instead of 

SF 2806. 

NOTE:	 An SF 2806 is also required if the employee transferred to 

FERS and is eligible for a CSRS annuity component. 

2.	 The pamphlet for employees is titled "Retirement and Insurance 

Information for Separating FERS Employees Who Are Not Eligible for 

an Immediate Annuity" (FERS Facts, RI 90-11). 

B.	 Applicant 1. The applicant must file RI Form 92-19, Application for Deferred or 

Responsibility	 Postponed Retirement, with OPM about 2 months before age 62 or the 

date the former employee wants the annuity to begin, if earlier. The 

application may be obtained by writing to the following address: 

Office of Personnel Management 

Federal Employees Retirement System 

Retirement Operations Center 

Post Office Box 200 

Boyers, PA 16020 

2.	 When a former employee with 10 or more years of service applies for 

a deferred annuity, he or she designates a commencing date of annuity. 

The designated commencing date may be: 

•	 The first day of the month after the former employee attains the 

MRA; or 

•	 A date (must be first day of a month) within 90 days after the 

application is filed; but 

•	 Not later than the second day before the employee's 62nd birthday. 

An election of a commencing date becomes irrevocable on the day 

OPM authorizes the first regular annuity payment. 

CSRS and FERS Handbook	 April, 1998 
16 Deferred Retirement	 FERS 

Chapter 45 

Section 45B2.1-2 Advice to Employee 

A.	 Applicable CSRS 

Provision 

The following portions of CSRS section 45A2.1-2 apply under FERS: 

•	 Paragraph A--Basis of Deferred Annuity 

•	 Paragraph B--Post-1956 Military Deposits 

•	 Paragraph F--Alternative Annuity 

B.	 Commencing 1. If the former employee has at least 5 years of civilian service, but less Date of Annuity	 than 10 years of total creditable service, the deferred annuity 

commences on the first day of the month after the individual attains 

age 62. 

2.	 If the former employee has at least 10 years of service, the deferred 

annuity can commence on: 

•	 The first day of the month after attainment of MRA; or 

•	 A later date designated by the former employee, but not later than 

the second day before his or her 62nd birthday. (See section

45B2.1-1, paragraph B.) 

C.	 Survivor Benefits 1. If a former employee who had less than 10 years of creditable service

dies before becoming an annuitant (that is, before he or she has 

reached age 62 and applied for a deferred annuity), any contributions 

remaining in the retirement fund are paid in a lump sum (with interest) 

in the order of precedence. No survivor annuity is payable. Chapter

75, Lump Sum Benefits, contains further information on this subject. 

2.	 If a former employee dies before applying for a deferred annuity and 

had: 

•	 At least 10 years of creditable service including 5 years of 

creditable civilian service, and 

•	 A surviving spouse who was married to the employee at the time 

of the former employee's separation from Federal service, or an 

eligible former spouse, 

the surviving spouse or former spouse is entitled to an annuity under 

the provisions described in Chapter 72, Spouse Benefits - Death of a 

Former Employee. 

3.	 No survivor annuity is payable to the children of a former employee 

who dies before becoming an annuitant. 

April, 1998	 CSRS and FERS Handbook 
Deferred Retirement FERS 17 

Chapter 45 

Section 45B2.1-2 Advice to Employee (Cont.) 

D.	 Refunds Former employees who take a refund of their retirement contributions are 

not eligible for a deferred annuity unless they return to Federal service and 

work under appointments with FERS coverage for at least 5 years. The 

refunded service is not creditable for any purpose under FERS. See 

Chapter 32 for more detailed information about refunds. 

Transferees with a CSRS annuity component who separate from Federal 

service may take a refund of the CSRS contributions, leaving their FERS 

contributions in the retirement fund. Such former employees retain title to 

a FERS deferred annuity and may redeposit the CSRS contributions without 

returning to Federal service. The redeposit may be made at any time before 

OPM completes processing of the individual's application for deferred 

annuity. It cannot, however, be deemed paid if the individual elects the 

Alternative Form of Annuity (AFA); a refund of CSRS contributions paid 

after an employee transfers to FERS can be redeposited only by actual 

payment to OPM of the amount due (see Chapter 53). 

REMINDER:	 CSRS Offset service is treated under FERS rules when 

employees transfer to FERS. A refund for Offset service 

paid after the employee transfers cannot be redeposited. 

See Chapter 20 for further information. 

E. Retiree Annuity Former employees who receive a deferred annuity are not eligible for the 

Supplement retiree annuity supplement. (See Chapter 51, Retiree Annuity Supplement.) 

CSRS and FERS Handbook	 April, 1998 
18 Deferred Retirement FERS 

Chapter 45
 

BLANK PAGE 

April, 1998 CSRS and FERS Handbook 
 CSRS	 Deferred Retirement FERS 19 

Chapter 45 

Subchapter 45C Job Aids and Forms 

Section 45C1.1-1 Information Aids 

This section contains the following information aids that can be reproduced 

locally: 

•	 Retirement and Insurance Information for Separating CSRS or 

CSRS Offset Employees Who Are Not Eligible for an Immediate 

Annuity 

•	 Retirement and Insurance Information for Separating FERS 

Employees Who Are Not Eligible for an Immediate Annuity 

CSRS and FERS Handbook	 April, 1998 
20 CSRS Deferred Retirement 

Chapter 45 

RETIREMENT AND INSURANCE INFORMATION FOR SEPARATING CSRS OR CSRS 

OFFSET EMPLOYEES WHO ARE NOT ELIGIBLE FOR AN IMMEDIATE ANNUITY 

This pamphlet contains information about retirement and insurance for separating employees who are 

under the Civil Service Retirement System (CSRS) or the CSRS-Offset provisions, and who are not 

eligible for an immediate annuity. If you meet one of the following age and service combinations, you 

are eligible for an annuity now, and your employing agency should help you apply for it. 

Eligibility Requirements for Immediate Retirement 

Type of 

Retirement 

Minimum 

Age 

Minimum 

Service 

Special Requirements 

62 5 None 

60 20 None 

55 30 None 

Optional 

50 20 You must retire under special provisions 

for air traffic controllers or law 

enforcement and firefighter personnel. 

Air traffic controllers can also retire at 

any age with 25 years of service. 

Any Age 

50 

25 

20 

Your agency must be undergoing a major 

reorganization, reduction-in-force, or 

transfer of function as determined by the 

Office of Personnel Management. 

Discontinued 

Service 

Any Age 

50 

25 

20 

Your separation must be involuntary and 

not for misconduct or delinquency. 

I.	 HEALTH BENEFITS 

A.	 31-Day Extension of Coverage and Temporary Extension of Coverage 

1.	 Enrollment in the Federal Employees Health Benefits (FEHB) program terminates at the 

end of the pay period in which you separate. You then have a 31-day free extension of 

coverage. 

2.	 Effective January 1, 1990, employees who separate from service may continue FEHB 

coverage for a period of 18 months from the date of separation. Employees who take 

advantage of this option must pay both the employee and the employer share of the health 

benefits premium plus an administrative charge of 2 percent of the premium. 

3.	 You cannot reinstate your FEHB coverage if you receive a deferred annuity in the future. 

April, 1998	 CSRS and FERS Handbook 
 CSRS	 Deferred Retirement 21 

Chapter 45 

B.	 Conversion Privilege 

1.	 If you do not want to continue your health benefits coverage under the temporary extension 

provision described in paragraph A, you may convert to an individual (nongroup) contract 

with your carrier. If you continue your coverage under the temporary continuation 

provision, you will have another opportunity to convert to an individual contract at the end 

of the 18-month period. 

2.	 If you convert, you must pay the entire cost of coverage and benefits may be less than 

previous coverage. However, the carrier must provide coverage regardless of any health 

problems you or your family members may have. 

C. Form You Should Receive: SF-2810--Notice of Change in Health Benefits Enrollment 

Upon separation, your employing office must complete SF 2810 terminating your enrollment 

and send you a copy. The SF 2810 explains about the 31-day extension of coverage and how to 

convert to a nongroup contract. Your employing office must also send you information about 

your eligibility for the temporary continuation of coverage described above (paragraph A), if 

you separated on or after January 1, 1990. 

II. LIFE INSURANCE 

A.	 Conversion Privilege 

Life insurance under the Federal Employees Group Life Insurance (FEGLI) program terminates 

at the end of the pay period in which you separate. You then have a 31-day free extension of 

coverage during which you may convert to an individual policy. 

You cannot reinstate your FEGLI coverage if you receive a deferred annuity in the future. 

B.	 Forms You Should Receive: 

SF 2821--Agency Certification of Insurance Status 

SF 2819--Notice of Conversion Privilege 

Upon separation, your employing office must complete SF 2821 terminating your coverage and 

send you a copy. It must also give you SF 2819 that provides information on your right to 

convert to an individual (nongroup) life insurance policy. 

III. RETIREMENT 

A.	 Option: Refund 

1.	 You may apply for a refund of your retirement contributions if you have been separated 

from Federal service for at least 31 days. The refund will not include any interest unless 

you have less than 5 years of service or some of your service was performed before 1957. 

Form to use: OPM Form 1425 (SF 2802)--Application for Refund of Retirement 

Deductions. 

CSRS and FERS Handbook	 April, 1998 
22 CSRS	 Deferred Retirement 

Chapter 45 

2.	 If you take a refund of your retirement contributions at separation, you may redeposit the 

refund (with interest) only if you return to Federal service under CSRS or FERS. 

3.	 Before you can receive a refund, you must notify your spouse and, in some cases, any 

former spouse that you have filed the application. If you are eligible for an immediate 

optional/voluntary retirement benefit, you cannot receive a refund. Also, you cannot 

receive a refund if the refund would end the court-ordered right of any spouse or former 

spouse to future benefits based on your service. For more detailed information about 

refunds, see OPM Form 1425 or Retirement Facts 9, "Refunds under the Civil Service 

Retirement System." 

B.	 Option: Deferred Annuity 

1.	 If you have at least 5 years of creditable civilian service, did not receive a refund of all 

retirement contributions, and are not eligible for an immediate optional/voluntary 

retirement benefit, you will be eligible for a deferred annuity at age 62. 

2.	 You should file OPM Form 1496A, Application for Deferred Retirement, with OPM no 

sooner than 2 months before attaining age 62. The deferred annuity commences on your 

62nd birthday. 

3.	 The deferred annuity is based on the length of service and high-3 average salary in effect at 

date of separation. 

4.	 If you want to make a deposit for post-1956 military service, you must make the deposit 

before separation in order to receive credit for the military service in the computation of 

your deferred annuity. 

5.	 If you are entitled to a deferred annuity, you may be eligible to elect the alternative annuity, 

that is, an actuarially reduced monthly benefit, plus a lump-sum payment equal to all your 

contributions to the retirement fund. (You must obtain your spouse's consent before you 

make this election.) 

NOTE:	 If you have a former spouse with court-awarded entitlement to a survivor 

annuity or a portion of your annuity, you may not elect the alternative annuity. 

NOTE:	 Subject to the restrictions imposed by Public Law 103-66, you may elect the 

alternative annuity only if you suffer from one of certain life-threatening 

illnesses and are entitled to a deferred annuity that commences on or after 

October 1, 1994. 

6.	 No survivor annuity is payable to your spouse, former spouse, or children if you die before 

you reach age 62. The same is true if you become age 62, but die before filing an 

application for retirement. The only benefit payable in either case would be a lump-sum 

payment of your retirement contributions, without interest. 

April, 1998	 CSRS and FERS Handbook 
Deferred Retirement FERS 23 

Chapter 45 

RETIREMENT AND INSURANCE INFORMATION FOR SEPARATING FERS EMPLOYEES 

WHO ARE NOT ELIGIBLE FOR AN IMMEDIATE ANNUITY 

This pamphlet contains information about retirement and insurance for separating employees who are 

under the Federal Employees Retirement System (FERS), and who are not eligible for an immediate 

annuity. If you meet one of the following age and service combinations, you are eligible for an annuity 

now, and your employing agency should help you apply for it. 

Eligibility Requirements for Immediate Retirement 

Type of 

Retirement 

Minimum 

Age 

Minimum 

Service 

Special Requirements 

62 5 None 

60 20 None 

MRA* 30 None 

MRA* 10 None 

Optional 

50 

Any Age 

20 

25 

You must retire under special 

provisions for air traffic controllers or 

law enforcement and firefighter 

personnel. 

Any Age 

50 

25 

20 

Your agency must be undergoing a 

major reorganization, reduction-inforce, or transfer of function as 

determined by the Office of Personnel 

Management. 

Discontinued 

Service 

Any Age 

50 

25 

20 

Your separation must be involuntary 

and not for misconduct or delinquency. 

*MRA = Minimum Retirement Age. Depending on your year of birth, the MRA ranges between ages 

55 and 57. To determine your MRA, refer to the table below: 

CSRS and FERS Handbook April, 1998 
24 Deferred Retirement FERS 

Chapter 45 

If Year of Birth Is... The Minimum Retirement Age is... 

Before 1948 55 

1948 55 and 2 months 

1949 55 and 4 months 

1950 55 and 6 months 

1951 55 and 8 months 

1952 55 and 10 months 

1953-1964 56 

1965 56 and 2 months 

1966 56 and 4 months 

1967 56 and 6 months 

1968 56 and 8 months 

1969 56 and 10 months 

1970 & After 57 

Please note that if you are now at the Minimum Retirement Age or older, and have at least 10 years of 

service, but have chosen to postpone applying for your annuity, the information in this pamphlet does 

not apply to you. Ask your agency for the appropriate information. 

I.	 HEALTH BENEFITS 

A.	 31-Day Extension of Coverage and Temporary Extension of Coverage 

1.	 Enrollment in the Federal Employees Health Benefits (FEHB) program terminates at the 

end of the pay period in which you separate. You then have a 31-day free extension of 

coverage. 

2.	 Effective January 1, 1990, employees who separate from service may continue FEHB 

coverage for a period of 18 months from the date of separation. Employees who take 

advantage of this option must pay both the benefits premium plus an administrative charge 

of 2 percent of the premium. 

3.	 You cannot reinstate your FEHB coverage if you receive a deferred annuity in the future. 

B.	 Conversion Privilege 

1.	 If you do not want to continue your health benefits coverage under the temporary extension 

provision described in paragraph A, you may convert to an individual (nongroup) contract 

with your carrier. If you continue your coverage under the temporary continuation 

provision, you will have another opportunity to convert to an individual contract at the end 

of the 18-month period. 

2.	 If you convert, you must pay the entire cost of coverage and benefits may be less than 

previous coverage. However, the carrier must provide coverage regardless of any health 

problems you or your family members may have. 

April, 1998	 CSRS and FERS Handbook 
Deferred Retirement FERS 25 

Chapter 45 

C. Form You Should Receive: SF 2810--Notice of Change in Health Benefits Enrollment 

Upon separation, your employing office must complete SF 2810 terminating your enrollment 

and send you a copy. The SF 2810 explains about the 31-day extension of coverage and how to 

convert to a nongroup contract. Your employing office must also send you information about 

your eligibility for the temporary continuation of coverage described above (paragraph A), if 

you separated on or after January 1, 1990. 

II. LIFE INSURANCE 

A.	 Conversion Privilege 

Life insurance under the Federal Employees Group Life Insurance (FEGLI) program terminates 

at the end of the pay period in which you separate. You then have a 31-day free extension of 

coverage during which you may convert to an individual policy. You cannot reinstate your 

FEGLI coverage if you receive a deferred annuity in the future. 

B.	 Forms You Should Receive: 

SF 2821--Agency Certification of Insurance Status
 

SF 2819--Notice of Conversion Privilege
 

Upon separation, your employing office must complete SF 2821 terminating your coverage and 

send you a copy. It must also give you SF 2819 that provides information on your right to 

convert to an individual (nongroup) life insurance policy. 

III. RETIREMENT 

A.	 Option: Refund 

1.	 You may apply for a refund of your retirement contributions if you have been separated 

from Federal service for at least 31 days. If you have more than 1 year of service, interest 

on the contributions will be part of the refund. If you are eligible for an immediate 

optional/voluntary retirement benefit, you are not eligible to receive a refund. 

Form to Use: SF 3106--Application for Refund of Retirement Deductions 

2.	 Before you can receive a refund, you must notify your spouse and, in some cases, any 

former spouse that you have filed the application. If you are eligible for an immediate 

optional/voluntary retirement benefit, you cannot receive a refund. Also, you cannot 

receive a refund if the refund would end the court-ordered right of any spouse or former 

spouse to future benefits based on your service. 

3.	 Refunded FERS contributions can never be redeposited and the service covered by the 

refund is not creditable for any purpose. 

CSRS and FERS Handbook	 April, 1998 
26 Deferred Retirement	 FERS 

Chapter 45 

4.	 If you are a transferee with a CSRS annuity component and you separate from Federal 

service, you may apply for a refund of your CSRS contributions only. (You may redeposit 

the CSRS contributions according to CSRS deposit rules.) By leaving your FERS 

contributions in the retirement fund, you will retain title to a FERS deferred annuity. 

NOTE:	 If you were covered by CSRS Offset provisions (both CSRS and Social 

Security) when you transferred to FERS, your Offset service is now treated as 

FERS service. You cannot redeposit a refund of Offset service deductions that 

you receive after transferring to FERS. The service covered by that refund is 

not creditable for any purpose. 

B.	 Option: Deferred Annuity 

1.	 If you have at least 5 years of paid creditable civilian service for which withholdings or 

deposits remain in the Fund and you are not eligible for optional/voluntary retirement 

benefits, you will be eligible for a deferred annuity. You may receive a deferred annuity 

beginning on the first day of the month after you attain age 62. In addition, if you have at 

least 10 years of creditable service, you may elect to receive a deferred annuity as early as 

the first day of the month after you attain your Minimum Retirement Age (MRA). 

2.	 If you are eligible for a deferred annuity beginning after you attain your MRA (see 

paragraph B1 above), your deferred annuity will be reduced by 5 percent for each year by 

which the commencing date of annuity precedes your 62nd birthday, unless you have at 

least 30 years of service; have 20 years of service, and postpone the commencing date until 

you are age 60; or have at least 20 years of service as an air traffic controller, firefighter, 

law enforcement officer, or Member of Congress. 

3.	 You must file form RI 92-19, Application for Deferred or Postponed Retirement, with 

OPM no sooner than 2 months before age 62 or the date you want the annuity to begin. If 

you separate with 10 or more years of service, you must designate a commencing date of 

annuity on or before age 62. 

4.	 If you receive a deferred annuity, you are not eligible for the retiree annuity supplement. 

5.	 The deferred annuity is based on the length of service and high-3 average salary in effect at 

date of separation. 

6.	 If you want to make a deposit for post-1956 military service, you must make the deposit 

before separation in order to receive credit for the military service in the computation of 

your deferred annuity. 

April, 1998	 CSRS and FERS Handbook 
Deferred Retirement	 FERS 27 

Chapter 45 

7.	 If you are entitled to a deferred annuity, you may be eligible to elect the alternative annuity, 

that is, an actuarially reduced monthly benefit, plus a lump-sum payment equal to all your 

contributions to the retirement fund. (You must obtain your spouse's consent before you 

make this election.) 

NOTE:	 If you have a former spouse with court-awarded entitlement to a survivor 

annuity or a portion of your annuity, you may not elect the alternative annuity. 

NOTE:	 Subject to the restrictions imposed by Public Law 103-66, you may elect the 

alternative annuity only if you suffer from one of certain life-threatening 

illnesses and are entitled to a deferred annuity that commences on or after 

October 1, 1994. 

8.	 If you die before applying for a deferred annuity and you have less than 10 years of 

creditable service or no eligible survivor, any contributions remaining in the retirement 

fund are paid in a lump sum (with interest) to your designated beneficiary or person in 

order of precedence as set by law. 

9.	 If you die before applying for a deferred annuity, your surviving spouse is entitled to a 

survivor annuity if: 

a.	 You have at least 10 years of creditable service for which withholdings or deposits 

remain in the Fund (5 years of which is creditable civilian service); and 

b. Your spouse was married to you at the time of your separation from Federal service. 

The surviving spouse may elect to receive a lump-sum payment of your retirement
 

contributions in lieu of the survivor annuity.
 

CSRS and FERS Handbook	 April, 1998