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government1956  
#1 Posted : Wednesday, August 26, 2009 1:07:58 AM(UTC)
government1956

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I am CSRS and planning to retire 12/31/11 with 33 years. I am a GS6 now and my high 3 will be 50,110. I am mortified to see what it will be when I retire at 64 %. Anyway, I know that tsp, retirement etc will not be deducted anymore. I wanted to know what the deductions for NYC would be and what percent of each tax/or deduction to get an idea of what I would actually have left. also do we get taxed at a lower rate for being retired? and is it true that there will be no cola's for csrs retiees until after 2012? No I have not attended any classes yet, I did go on Fed Cal to see what my retirement would be it would be 32,112. gross.

any help would be apprecaited. just brain storming, and wondering how much more I would make if I stayed longer and is it worth it. Smile
postalwiz  
#2 Posted : Wednesday, August 26, 2009 2:18:00 AM(UTC)
postalwiz

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Do not know the laws in NYC if you have a
State Tax. Other deductions that they will
not take out are Medicare Taxes; Union dues
unless you want to continue; big savings on
wear and tear of your clothing, big savings
on transportation. Not all of your annuity
is tax free of Federal Taxes; only a portion
of it is accordning as to how much you contributed to the Retirement Plan, how old you
are and date of retirement (OPM has a table that
will calculate how much of your annuity is
exempt from Federal Taxes. If NYC is a State
with no income tax, you will not have to pay
anything; if it is; is best to check with
your State and see if your retirement is
exempt from taxes; in some States they have
regulations that exempt disabled Veterans from
State Income Taxes.
fedman53  
#3 Posted : Wednesday, August 26, 2009 3:37:25 AM(UTC)
fedman53

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64% may not sound like alot, but beats Social Security. Look at your current "Take home pay" (Net Pay). That's what you're living on now. When I retire, all that will be withheld will be Fed tax (defined by W-4P) and FEHB premiums. My state only taxes "earned' income, so all retirement is tax free (CSRS, TSP, SS).
government1956  
#4 Posted : Wednesday, August 26, 2009 3:45:34 AM(UTC)
government1956

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Are you saying there is a portion of Federal Tax that CSRS are exempt from? NY State does not tax federal pensions.
government1956  
#5 Posted : Wednesday, August 26, 2009 4:04:24 AM(UTC)
government1956

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do csrs retirees pay social security? in their deductions?
postalwiz  
#6 Posted : Wednesday, August 26, 2009 4:06:48 AM(UTC)
postalwiz

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Yes a portion of your annuity (not much mind
you with $94000 in contributions and retiring
at age 60) with a $42000 pension or $4144
a month only $323 is exempt from Federal Taxes.
If you want to give me what your contributions
are, date of birth, plan date of retirement I
will calculate it for you. If NY does not tax
Federal Pensions something less to worry about.
postalwiz  
#7 Posted : Wednesday, August 26, 2009 4:07:17 AM(UTC)
postalwiz

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quote:
Originally posted by Government1956:
do csrs retirees pay social security? in their deductions?
no; you have been paying
a Medicare Tax on your earnings as a CSRS
employee but you do not have to pay it
once you retire and you do not pay Social
Security on your annuity.
government1956  
#8 Posted : Wednesday, August 26, 2009 4:40:18 AM(UTC)
government1956

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dob 2/23/56
retirement date 12/31/11
service comp 6/3/78
771 sl
high 3 50,110
33 yrs 6 mos 28 days
percent of high 3 64.0833
basic annunity 32,112
northpuget  
#9 Posted : Wednesday, August 26, 2009 8:26:41 AM(UTC)
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You've got 28 days beyond a whole month of service time. Unless you want to cash out a bunch of Annual Leave over 240 hour carry-over, think about staying on an additional month or three to build up enough extra sick leave to make that an entire month. You'd also add on the additional month or so to your service time.
daves  
#10 Posted : Wednesday, August 26, 2009 10:45:01 AM(UTC)
daves

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quote:
Originally posted by northpuget:
You've got 28 days beyond a whole month of service time. Unless you want to cash out a bunch of Annual Leave over 240 hour carry-over, think about staying on an additional month or three to build up enough extra sick leave to make that an entire month. You'd also add on the additional month or so to your service time.


You do not have to work an entire month. Just a few more days, retiring on Jan 3, may give you the extra month service credit.
junkmail  
#11 Posted : Wednesday, August 26, 2009 11:20:31 PM(UTC)
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Government1956, I have tried to answer your questions in the order that you asked them. I would recommend that you avail yourself of the information presented in the CSRS and FERS Handbook. It is available at: http://www.opm.gov/retire/pubs/handbook/hod.htm

1. You will not be taxed by NYC on your pension. Qualified pension benefits or distributions received by officers and employees of the United States, New York State, and local governments within New York State, are exempt from New York State, New York City, and Yonkers income taxes. This subtraction modification is allowed regardless of the age of the taxpayer or of the form the payment(s) take. You can find this information in the NYS Dept of Taxation and Finance, Pub 36: General Information for Senior Citizens and Retired Persons at: http://www.tax.state.ny.us/pdf/publications/income/pub36.pdf

2. Federal, NY state and NYC income tax rates do not change based on your retirement status. However under Federal Law, as Postalwiz stated, you can recover the cost of your annuity tax free. NY state also offers what it calls subtractions based on age/retirement status. You can find the NY subtractions in the Pub 36 referenced above. Under Federal Law you recover the cost of your annuity over a number of months based on your age at retirement. Since you plan to retire at 55, you can recover your cost over 360 months. Yes, that really is 30 years. If you wait until 56 to retire, you can recover your cost over 310 months or 25.83 years. The cost of your annuity is the total of your contributions to the retirement plan. You can find information on this and much more in IRS Pub Pub 721, Tax Guide to U.S. Civil Service Retirement Benefits at http://www.irs.gov/pub/irs-pdf/p721.pdf

3. The CSRS COLA is equal to the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of one year to the third quarter of the next. The CPI-W has not increased from the 3rd quarter of 2008, but no COLA until after 2012 is based on forecasting.

4 Staying longer will increase your annuity, but only you can answer if it is worth it.

A. You will increase your annuity by 2% for each whole year you stay. Playing with your retirement date in FedCalc will give you pretty accurate numbers.
B. The additional sick leave you accrue staying longer will add to your years of service. FedCalc can again help.

C. Assuming that your present pay is the highest in your high 3 calculation, just staying longer will increase your high three. If there are GS pay increases or you get a time or grade increase by staying, your high three will be further increased. This is certainly a consideration with the COLA being forecast to stay at zero for several years.

D. Staying until you are at least 56 will accelerate the cost recovery of your retirement contributions.

E. You will be able to continue contributions to the TSP and an IRA while you are employed.
crpetersen  
#12 Posted : Wednesday, August 26, 2009 11:20:50 PM(UTC)
crpetersen

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You need to add together your service time and your sick leave before you can determine how much sick leave you will have left over. Your total time for annuity computation will be 33 years, 11 months, 11 days, if at your retirement you still had 771 hours sick leave, which equals 4 mo 13 days. Carolyn
government1956  
#13 Posted : Thursday, August 27, 2009 12:11:53 AM(UTC)
government1956

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Smile
postalwiz  
#14 Posted : Thursday, August 27, 2009 12:54:49 AM(UTC)
postalwiz

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quote:
Originally posted by Government1956:
dob 2/23/56
retirement date 12/31/11
service comp 6/3/78
771 sl
high 3 50,110
33 yrs 6 mos 28 days
percent of high 3 64.0833
basic annunity 32,112


You need to give me amount of contributions
to the retirement system, project them to
12/31/11 as what is exempt for Federal Taxes
is based on your contributions, not your high 3.
As you have the above information, your must have
a retirement print-out your contributions to the
CSRS are in that print-out project that amount
until 2011. Revisit the sick leave balance issue
2 months prior to retirement.
government1956  
#15 Posted : Thursday, August 27, 2009 2:47:36 AM(UTC)
government1956

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I always have 240 of annual leave after using my 208 hours for each year. The year I retire, which will be 12/31/11 (that's the last day for 2011, it's not January) I plan on saving the 208 and the 240 a total of 448, and get paid for it. Is that allowed in that amount of 448? Roll Eyes
dave95sps  
#16 Posted : Tuesday, September 01, 2009 8:36:19 PM(UTC)
dave95sps

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Yes - you can cash in the entire amount of unused annual leave (240 plus whatever you earned during the last year). But they will tax your cash-out heavily. I forget the percentage, but I was shocked when I saw the net check.
jaybones  
#17 Posted : Tuesday, September 01, 2009 10:08:32 PM(UTC)
jaybones

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Gov1956,

Others on this Board have increased the number of their deductions just before retirement which helped them avoid such a huge bite on their Annual Leave Lump Sum payment. I know that I plan on doing that when I retire.
Andy ChFEBC in CA  
#18 Posted : Thursday, September 03, 2009 3:33:56 AM(UTC)
Andy ChFEBC in CA

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Posts: 15

Hi Government1956. I know where you can get that calculation for no cost. A very detailed analysis. email me at andrew.hudson@cambridgefp(dot)com
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