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Federal Retirees


For those approaching retirement as well as the currently already retired, here is a forum to share ideas and thoughts and exchange questions and answers.


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jca245  
#1 Posted : Tuesday, December 23, 2008 2:16:29 AM(UTC)

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Hello all-

I retired from The Federal Bureau of Prisons January 31 of this year (2008) as a 54 year old GS11 / 10. My 20 years came up on January 3rd but was advised to wait until the end of the month. Although I could have worked for 3 more years before mandatory age, medical issues “encouraged” my retiring before my 57Th birthday.
I am under the FERS system, and had 81/2 years of military added on so in total, I have 28 years, 6 months and 28 days total.

I found out about the medical deduction tax recently, if I remember correctly, one can deduct up to $3000 in medical expenses, to include monthly premium payments each year. I was wondering if anyone could tell be if I will be eligible for this deduction since I was not retired the entire year (11 months)?

Also, I could be wrong but I heard that CSRS and FERS has a COLA increase next year. If so, would I be eligible for that, or not, because of the same issue of not being retired the full year of 2008?

Its things like this that you learn about that tend to make you ponder into the wee hours of the AM. Of course in addition, I could not have picked a worse time to retire as the economy went to He** in a hand basket and vaporized about 40% of my savings. IMHO, we are very fortunate to have a pension to live on as I feel bad for those trying to live on just their savings and 401K right now. I have been pulling as little as I can from my savings and not touching my Thrift yet, but it is very difficult.

Hopefully everyone is doing well as can be expected, and wish you all a Merry Christmas and a Joyous New Year.

Take care-

Joe “ExFed” Aimetti
Kingsport, TN
junkmail  
#2 Posted : Tuesday, December 23, 2008 8:33:25 PM(UTC)

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As a Federal LEO, you will be eligible to deduct up to $3000 from your income for medical and long term care insurance premiums paid directly from your annuity. The IRS rule is quoted below.

From IRS Pub 721:
quote:
If you are an eligible retired public safety officer (law enforcement officer, firefighter, chaplain, or member of a rescue squad or ambulance crew), you can elect to exclude from income distributions made from an eligible retirement plan that are used to pay the premiums for accident or health insurance or long-term care insurance. The premiums can be for coverage for you, your spouse, or dependents. The distribution must be made directly from the plan to the insurance provider. You can exclude from income the smaller of the amount of the insurance premiums or $3,000. You can only make this election for distribution that would otherwise be included in your income. The amount excluded from your income cannot be used to claim a medical expense deduction.


You can find the 2009 COLA at: http://www.opm.gov/retire/annuity/cola/2009cola.asp
Since you retired under the special provisions for LEOs, you get the COLA without reguard to age. You will get a 4% increase for 2009, as your annuity started on 1 Feb 2008.
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