In the event of a divorce, dividing retirement assets can get complicated for everyone. For federal employees, dividing retirement benefits like their FERS/CSRS annuity, Thrift Savings Plan (TSP) and FEHB benefits can get even more complicated.
Divorce Orders Must Comply With Federal Law
Since federal employment is governed by provisions in federal law, standard state court divorce orders used to divide private sector retirement plans may not be considered valid. Divorce orders involving federal retirement benefits must comply with federal law and be on file with the Office of Personnel Management for proper processing.
How Your FERS/CSRS Annuity Is Divided
The number of years of your federal career that overlapped with your marriage determines your ex-spouse’s share of your FERS/CSRS annuity. It starts with calculating the number of months between the your marriage and your separation date. Then the annuity amount is divided by the total months of federal service.
If you get divorced while you’re still employed by Uncle Sam, a Court Order Acceptable for Processing, or COAP, will be kept on file with the OPM until you retire. Once the amount is determined, your ex-spouse’s payment begins at the same time you start receiving your retirement annuity. However, if you and your former spouse did not specifically negotiate to include a FERS/CSRS survivor benefit in your divorce settlement, they may not be eligible to receive it when you pass away.
“Unlike your annuity, your ex-spouse does not have to wait until you retire to receive their share of your TSP.”
How Your TSP Is Affected In A Divorce
Since the earnings you’ve contributed to your TSP during your marriage is considered marital property, an ex-spouse is eligible to receive their share through a distribution or a direct transfer to a qualified retirement plan. Unlike your annuity, your ex-spouse does not have to wait until you retire to receive their share of your TSP.
How FEHB Coverage Is Affected In Divorce
Though a spouse’s FEHB benefits end upon divorce, under the Civil Service Retirement Spouse Equity Act, an ex-spouse has 60 days from the date of the divorce to enroll in FEHB if they meet the following qualifications:
- They were divorced during their former spouse’s employment or retirement and they’re entitled to a portion of their former spouse’s annuity or survivor annuity.
- They were covered as a family member under FEHB for at least one day during the 18 months before the end of the marriage.
- They have not remarried before age 55.
As you can see, it’s important to work with a divorce attorney who has experience representing federal employees.
