Divorce is something that most individuals would prefer to avoid. The sometimes enormous legal costs associated with divorce together with the emotional issues that can affect family (especially children) can have a devastating effect on the average person.
Some federal employees in the past — and there are, and there will be federal employees in the future — who unfortunately continue to face the experience of divorce. Most federal employees have built up a significant amount of retirement and insurance benefits during their years of federal service.
This column is the first of three columns discussing divorce and federal employees. The first column presents how court orders associated with a divorce can affect a federal employee’s CSRS or FERS annuity.
An apportionment order is a legal document that divides an employee’s CSRS or FERS annuity, or a refund of an employee’s contributions to the CSRS or FERS Retirement and Disability Fund in accordance with a court order related to a federal employee’s divorce or legal separation.
The Office of Personnel Management (OPM) is authorized to comply with an apportionment order that meets certain specifications, the authorization of which is authorized in Sections 8345(j) and 8467 of Title 5, United States Code.
Advertisement
The law requires that OPM to apportion an annuity, or to refund an employee’s contributions to the CSRS or FERS Retirement Disability Fund, in accordance with the express provisions of a qualifying court order, court decree, or property settlement. OPM also is authorized to make payments directly to the former or separated spouse if the terms of the court order expressly demand for payment in such a manner.
A court order should specify exactly what it wants OPM to do with respect to a CSRS or FERS annuity, or refund of an employee’s contributions to the CSRS or FERS retirement and disability funds. The spouse’s share of any annuity must be stated as a fixed dollar amount, a percentage or a fraction of the annuity, or be expressed as a formula whose value is readily apparent to OPM. OPM will do nothing with respect to a court order unless the court order is specific and clear.
While there is no percentage limitation on how much of a CSRS or FERS annuity payment can be awarded to a former spouse, payment under an apportionment order cannot exceed the net annuity (that is, the gross annuity after taxes and insurance premiums are deducted)in cases involving annuities, or the amount of the lump sum employee contributions in cases involving refunds of CSRS or FERS employee contributions.
Before any benefit can be paid to a former spouse, the former spouse (or his or her attorney) must submit a written request of a court order to OPM and provide proper documentation in order for OPM to establish the validity of the court order.
With respect to a CSRS or FERS annuity, the former spouse must apply in writing (no oral requests) – either personally or through a representative (such as an attorney) in order to be eligible for a portion of their ex-spouse’s CSRS or FERS annuity check. No special form is required. However, the former spouse must include the following information in the letter requesting a portion of the CSRS or FERS annuity:
• Certified copy (not a photocopy of the court order) signed and certified by an official of the court that issued the order – verifying that it is a true copy of the original court order
• A signed statement that the court order has not been amended, superseded or set aside
• Identifying information concerning the employee or retiree including his or her full name, date of birth, civil service annuitant (CSA) claim number, if retired, and his or her Social Security number, and
• If the spouse is still in federal service, his or her mailing address.
A former spouse who is awarded a portion of an employee’s or retiree’s CSRS or FERS annuity through a qualifying court order (whether that benefit is payable now or in the future) is eligible to enroll in the Federal Employee Health Benefits Program (FEHBP) under certain conditions. These conditions will be discussed in a separate MFR column.
Applications for court awarded CSRS or FERS benefits and requests for information should be sent to:
Office of Personnel Management
Office of Retirement Programs
Court Order Benefit Section
P.O. Box 17
Washington, DC 20044-0017
For purposes of awarding a former spouse survivor annuity, a court order must state the former spouse’s entitlement to a survivor annuity or direct an employee or retiree to provide a former spouse survivor annuity. There is one exception – a court order is not a qualifying court awarding a CSRS former spouse annuity if;
(1) The marriage was terminated before May 7, 1985; or
(2) The marriage was terminated on or after Mary 7, 19875, and the retiree retired from federal service before May 8, 1985 and did not provide a current spouse annuity for that spouse as of May 7, 1985. Note that May 7,1985 is the effective date of Internal Revenue Code Section 1041 in which the IRS rewrote tax regulations associated with divorce.
The former spouse of a separated CSRS employee may be awarded a deferred annuity pursuant to a court order. A separated CSRS employee who is eligible for a deferred retirement is an individual who left federal service before his or her retirement age (age 55 with 30 or more years of federal service, age 60 with between 20 and 30 years of service, or age 62 with between 5 and 19 years of federal service) and will receive a deferred CSRS annuity starting when the separated employee becomes age 62. Note that no survivor annuity will be paid in the case of a CSRS deferred retirement unless the separated CSRS employee dies after age 62.
The former spouse of a FERS employee or retiree may be awarded a survivor annuity benefit pursuant to a court order. The former spouse of a separated FERS employee may be awarded a deferred annuity pursuant to a court order.
A separated FERS employee who is eligible for a deferred retirement is an individual who left federal service before his or her retirement age (before minimum retirement age with 30 or more years of service; between age 60 with between 20 and 30 years of service; or before age 62 with between 5 and 19 years of service). Note that no survivor annuity will be paid in the case of a FERS deferred retirement unless the separated FERS employee dies after minimum retirement age (for a FERS employee who left federal service before minimum retirement age with more than 30 years of service), or after age 60 (for a FESR employee who left federal service with between 20 and 30 years of federal service), or after age 62 (for a FERS employee who left federal service with between five and 19 years of service).
An employee retiring under CSRS or FERS may voluntarily elect a full reduced annuity or partially reduced annuity to provide a former spouse survivor annuity. If the employee has remarried, the employee may request this election, provided the current spouse consents to the election or OPM waives the spousal consent requirement.
Entitlement to a CSRS or FERS employee’s survivor annuity terminates at the end of the month preceding the earliest of: (1) The death of the former spouse; (2) The remarriage of the former spouse before age 55 if the marriage of the former spouse to the employee or retiree lasted less than 30 years; or (3) The survivor annuity termination date established under the terms of the court order.
If a former spouse’s survivor annuity terminates under one of the above three conditions, then any reduction in the retiree’s annuity to provide a former spouse annuity will cease the first day of the month after the terminating event unless:
• The retiree elects within two years after the former spouse’s death or remarriage to continue the reduction to provide or increase a former spouse annuity for another former spouse or to provide for an increase to a current spouse annuity; or
• A qualifying court order requires the retiree to provide another former spouse an annuity.
A former spouse who loses entitlement to a survivor annuity because of remarriage before age 55 cannot request that the survivor annuity be reinstated if the subsequent marriage later ends by death or divorce.
A former spouse who loses entitlement to a survivor annuity because of remarriage before age 55 (this assumes the former spouse’s marriage to the federal employee or retiree lasted less than 30 years) cannot have the survivor annuity reinstated if the marriage ends due to annulment unless:
(1) The decree of annulment states that the marriage is without legal effect retroactively from the date of the marriage and:
(2) The former spouse’s entitlement is based on section 4(b)(1)(B) or section 4 (b)(4) of Public Law 98-61. This provision provides survivor annuities in limited circumstances without any reduction to the retiree’s benefits.
