Everything You Should Know About Your Federal Benefits During A Divorce

Federal employees who go through divorce proceedings may also find that their federal benefits may be affected. Federal employees may have certain benefits for their spouses to ensure fair property division. Federal employee benefits do not automatically extend to ex-spouses. The final separation agreement must also include a court order granting the ex-spouse an equal share of the retirement benefits and extending other federal benefits such as health insurance.

It can be difficult to predict the effects of divorce on federal benefits. It is helpful to consult with divorce lawyers in Ellicott City to understand the laws of your state and how they relate to federal benefits during a separation.

Annuity Benefits

Federal Employees Retirement System A federal employee retirement plan, offers benefits from three sources: Social Security Benefits Plan (SSD), Basic Benefits Plan (BBP) and Thrift Savings Plan(TSP). FERS requires employees and agencies to pay a part each pay period for the Basic Benefit and Social Security components.

Annuity payments are made monthly to the employee at retirement. Annuity payments can be affected by a court order requiring federal retirees that they pay a part of their annuity benefits to their former spouses. This happens while the retiree continues to live and ends when he or she dies.

Survivor Benefits

Federal employees can receive retirement benefits while they’re still alive. Survivor benefits are available to survivors, including ex-spouses. The ex-spouse of a federal retiree or federal employee may receive the full survivor benefit or at most the marital percentage for the survivor pay.

The survivor payment is not payable unless the divorce decree specifically refers to a survivor Annuity under FERS/CSRS. FERS employees can die while they are still working. A surviving spouse may be entitled to FERS Basic Employee Dead Benefit (BEDB).

Refunds Of Contributions

A federal employee may request a return of any retirement contributions they made to the Civil Service Retirement System. You can receive this money in one lump sum payment. Federal employees who have at least five years of creditable work can also request a monthly retirement benefit at retirement.

You must be aware that if a federal government employee resigns/withdraws their FERS/CSRS contribution, a court may award a part or all of the funds to a former spouse. The court may also prevent payment of reimbursement until final divorce proceedings have been concluded.

Health Benefits

Federal spouses may be covered by their spouse’s medical, vision, and dental insurance. However, the spouse will cease to be covered once the marriage has been finalized. Once this happens, the former spouse will be granted an extension period of 31 days during which he/she can either move to a new individual contract or continue to get FEHB coverage as per Temporary Continuation (TCC) guidelines. TCC provisions from the FEHB Law continue for up to 36 months.

There are currently no provisions that allow a former spouse to retain coverage under Federal Employees Dental & Vision Insurance Programs. This coverage is terminated for the former spouse on the effective day of the divorce.

Group Life Insurance

Federal employees who meet the eligibility requirements are automatically enrolled on Basic Insurance under Federal Employees’ Group Life Insurance. Optional and Basic Insurance may also be available to their spouses. A federal employee may be required by the court to either transfer FEGLI coverage from their spouse to another person or name them as a beneficiary.

Thrift Savings Plans

Many assets can easily be divided during a divorcing process, including a TSP. Thrift Savings plans are usually divided in one way. The first way is by a Retirement Court Order (RBCO), a court order that divides retirement benefits. This could be an annulment. It can also be separated by a property agreement approved court.

TSP accounts are subject to a court order. This means that the TSP account can not be accessed or withdrawn until the divorce is over. A separate court order will be required to allow the TSP to send the former spouse a portion of the amount that was given to them or her in the decree.