Federal Employees Retirement System (FERS) Disability Retirement: Further SSDI Considerations

In filing for Federal or Postal Disability Retirement under FERS, one must, of course, file for SSDI.  Whether you want to pursue SSDI aggressively or not, depends upon what one’s future plans will be.  Remember that you can make (in addition to the disability annuity paid) up to 80% of what one’s former Federal or Postal job currently pays. 

Thus, take the following hypothetical:  An individual makes $60,000.00 per year, and files for Disability Retirement under FERS.  In the first year, the individual’s annuity would be $36,000; and every year thereafter, it would be $24,000.00.  On top of that annuity amount, however, the former Federal or Postal employee could go out and become employed, and make up to $48,000.00 per year at another job, on top of the $24,000.00 in disability annuity, for a combined income of $72,000.00. 

Now, some might be critical of the fact that under the rules governing OPM Disability Retirement, one can actually make more total income — 120% — than before becoming qualified for FERS Disability Retirement.  Some have called this a “windfall”.  Instead, one should look at it this way:  it is a thoughtful paradigm, because the system encourages a person to become productive in some other capacity.  Moreover, that person further contributes to the system which he or she left, by paying Federal taxes through the “other” employment.  Incentives work, and in this case, it makes economic sense for both the Federal government and for the disabled former federal or postal employee.

Sincerely, Robert R. McGill, Esquire

FERS & CSRS Disability Retirement: Considerations Prior to Pursuing SSDI Aggressively

In filing for Federal Disability Retirement benefits under FERS, one must file for SSDI and submit proof of such filing with the Office of Personnel Management at the time of approval of the Federal Disability Retirement application.  For CSRS individuals who file for Federal Disability Retirement, no such filing is required, precisely because the framework of a CSRS retirement/disability retirement is not tied into the Social Security system. 

Remember that, under FERS, when a Federal or Postal Worker files for Federal Disability Retirement benefits, all that is necessary is to fulfill the requirement of “filing” — meaning, that a receipt must be submitted evidencing the filing of an SSDI application.  One does not need an approval or a denial — merely a receipt showing that one has fulfilled the statutory requirement of filing.  Ultimately, of course, the Office of Personnel Management is seeking to discover whether or not the Federal or Postal worker is eligible for SSDI, and if so, that an offset will be triggered.  Because of the possible offset (and the potential repercussions of OPM refusing to reinstate the full FERS Disability Retirement benefits in the event of an SSDI/FERS disability retirement annuitant having reached a status of gainful employment — see my previous blog post), one needs to take into consideration all of the factors, circumstances, future goals and future plans, before one decides to “aggressively” pursue SSDI benefits.  

Sincerely,

Robert R. McGill, Esquire