RI 20-80 July 2012 Markup

United States
Office of Personnel Management
Retirement Operations
Washington, D.C. 20415
Claim Number

CSA
Case Name (last, first, middle)
This Notice Dated
Please Reply by

Alternative Annuity Election Information
This letter explains an important election which must be made before we can complete work on your retirement application.
You must choose one of the three options (1A, 1B, or 2) shown on the enclosed Alternative Annuity Election. Please read
all of the information provided in this letter (and the enclosures) carefully before making your election.
The annuity rates shown are based on the survivor election made on your retirement application. In choosing an option, you
will be affirming the survivor election previously made. If there is some reason that you now wish to change the election
you made on your retirement application, please write to us immediately or you may call the telephone number shown
at the bottom of this page under "NOTE." (We will send you another alternative annuity election letter, along with a form
that must be completed to obtain your spouse's consent to the change in your survivor election.) Your survivor election can
be changed later, but only under limited circumstances.
This election cannot be postponed until after the Office of Personnel Management (OPM) completes action on your
claim. Please use the pre-addressed envelope to return your signed original election form. If your completed election
is not returned by the reply date shown above, your application will be processed under Option 1A.

Regular Annuity - Option 1A or 1B
Option 1A shows the annuity rates to which you and your survivor are entitled if you do not elect the alternative annuity
described in Option 2. The rate shown includes a reduction if you have not paid a redeposit for a refund of Civil Service
retirement deductions which were withheld while you were performing service which ended before October 1, 1990. The
law provides that your annuity will be computed to give you credit for the refunded service, but that an actuarial reduction
will be applied to the monthly rate. The reduction is based on the amount owed for the redeposit using the same actuarial
factors used to determine the alternative annuity reduction. If you performed Civil Service Retirement System (CSRS)
service on or after October 1, 1982, during which no retirement deductions were withheld from your salary (10/1/82
deposit service) or any Federal Employees Retirement System (FERS) service prior to 1989 during which no retirement
deductions were withheld from your salary, we have NOT included that service in the computation of the annuity rate
shown. The amount of your annuity without this reduction is shown in Option 1B. Survivor rates are not shown if you did
not elect a survivor annuity on your retirement application.
Paragraph removed

(Continued on reverse side)

RI 20-80
Revised July 2012

Option 1B shows the annuity rates to which you and your survivor are entitled if you do not elect the alternative annuity
described in Option 2 and you elect to pay the redeposit for any refunded Civil Service Retirement System (CSRS) service
and/or a deposit for any CSRS 10/1/82 deposit service or any Federal Employees Retirement System (FERS) service prior
to 1989 during which no retirement deductions were withheld. The total amount you owe, including interest, is shown. If
you elect Option 1B, the repayment must be made in full now; installment payments will not be accepted. Survivor rates are
not shown if you did not elect a survivor annuity on your retirement application.
Alternative Annuity With Lump-Sum Payment - Option 2
Option 2 shows the monthly annuity you will receive if you choose a reduced "alternative" monthly annuity rate instead of
the monthly annuity which you could elect under Options 1A or 1B. If you choose this option, you will receive a lump-sum
payment equal to all your retirement contributions, as well as the reduced monthly annuity shown on the election form. If
you have ever peformed service which was not covered by retirement deductions, we have computed your annuity rate
under Option 2 as though you have paid any amount owed.
Note to retirees covered by the Federal Employees Retirement System (FERS): Under Option 2 your annuity has been
computed as though you had paid any amount owed for service performed before 1989 which was not covered by
retirement deductions.
You may not elect Option 2 if you have a former spouse who is entitled by court order to receive a portion of your annuity
or a survivor annuity based on your service regardless of whether or not your former spouse would consent. If you were
married at the time you retired and you wish to elect Option 2, your spouse must consent to your election by signing the
election in the presence of a notary public or other official authorized to administer oaths. If you were divorced after
retirement and no survivor benefit or portion of your annuity was awarded in the divorce, your former spouse must consent
to your election of Option 2 in the presence of a notary.
Rollover Election
The Federal income tax law permits you to elect a tax-free rollover of your alternative annuity lump sum to an eligible
individual retirement arrangement or employer plan. Rollover information and election forms are enclosed. If you elect
Option 2, Alternative Annuity with Lump Sum Payment, please read the rollover information and make your rollover
election.
Alternative Annuity Election and Disability Retirement
The retirement law provides that an employee may file for disability retirement at any time prior to separation or within one
year thereafter. However, the Federal Employees Retirement System Act of 1986, which established the alternative form of
annuity option, limits eligibility for the alternative annuity option to those retirees who elect non-disability retirement
annuity (5 USC 8343a, 5 USC 8420a, 5 CFR 831.2203 and 5 CFR 842.703). Please be advised that if you elect the
alternative form of annuity (Option 2), you will not be permitted to change to a disability retirement after the final
adjudication of your claim.
Concurrent Payment of Workers' Compensation Benefits
The following information is particularly important if you are, or may become, entitled to receive non-scheduled
compensation benefits for a job-related injury or illness from the Department of Labor, Office of Workers' Compensation
Programs (OWCP).
The Department of Labor and the Internal Revenue Service have made determinations regarding the effect that payment of
the lump-sum portion of the alternative annuity option has on eligibility for OWCP compensation benefits and on Federal
income tax liability for alternative annuity payments. You should consider the ramifications of these determinations which
are discussed below so that you can make an informed annuity election.

The Federal Employees' Compensation Act (FECA) prohibits "concurrent" payment of non-scheduled Office of Workers'
Compensation (OWCP) benefits and other remuneration from the Federal government, including annuity benefits. The
Department of Labor has determined that, if an individual is entitled to non-scheduled compensation for a job-related injury
or illness under FECA, he or she cannot receive the monthly annuity or lump-sum portion of the alternative annuity option
and the non-scheduled compensation from OWCP for the same time period. This means that if you elect Option 2 and
receive the lump sum, but then choose to receive OWCP benefits instead, all OWCP benefits will be paid to the Office of
Personnel Management (OPM) (with no benefits coming to you) until the entire lump-sum payment amount and the monthly
annuity paid to you have been repaid to OPM. Receipt of non-scheduled OWCP benefits does not terminate your right to
reinstate your retirement benefits (if your OWCP benefits were reduced or terminated). However the alternative annuity
lump-sum payment must be elected at the time of retirement or not at all; therefore, if your retirement benefits were later
reinstated, you would then be eligible to receive only the regular annuity benefit. You would not be eligible to receive the
alternative annuity again (or at all if you initially elected the regular retirement annuity).
You may alter your election and choose another option on or before the date that is 30 days after the date of your first
regular monthly annuity payment by giving OPM written notification of your desire to change your election. However, you
should also be aware of a ruling by the Internal Revenue Service (IRS) on the Federal income tax implications if the
lump-sum portion of the alternative annuity is paid and you subsequently decide to repay it to OPM. IRS has determined
that once you have elected the alternative annuity and the lump sum is paid, you have incurred tax liability for the payment,
and that tax liability is not altered by subsequent repayment to OPM. Generally, 85 to 95 percent of the lump sum is
taxable. If you elect the alternative annuity and subsequently elect to receive compensation benefits, you will still have
incurred tax liability for the lump-sum payment and your tax liability will not change even though you repay the lump sum.
The Alternative Annuity Election includes your affirmation that you understand that you may not legally receive both
retirement annuity and non-scheduled compensation from OWCP for the same period of time. If you are presently eligible
for non-scheduled OWCP benefits, you should notify OPM immediately.

Retirement Operations
Enclosures:
Alternative Annuity Election (RI 20-80)
Information for Your Tax Records (RI 37-8)
Rollover Information (RI 38-118)
Rollover Election (RI 38-117)
Special Tax Notice Regarding Rollover (RI 37-22)
Pre-addressed envelope to return your election to OPM

Privacy Act Statement
Solicitation of this information is authorized by Chapters 83 and 84, title 5, U.S. Code. The information you furnish will be used to obtain additional information, if
necessary, and to determine and allow present or future benefits. The information may be shared and is subject to verification, via paper, electronic media, or through the
use of computer matching programs, with national, state, local, or other charitable or social security administrative agencies in order to determine benefits under their
programs, to obtain information necessary for determination of benefits under this program, or to report income for tax purposes. It may also be shared and verified, as
noted above, with law enforcement agencies when they are investigating a violation or potential violation of civil or criminal law.
Public Burden Statement
We estimate this form takes an average 20 minutes per response to complete, including the time for reviewing instructions, getting the needed data, and reviewing the
completed form. Send comments regarding our estimate or any other aspect of this form, including suggestions for reducing completion time, to the Office of Personnel
Management (OPM), Retirement Services Publications Team (3206-0168), Washington, D.C. 20415-3430. The OMB Number, 3206-0168 is currently valid. OPM may
not collect this information, and you are not required to respond, unless this number is displayed.

Alternative Annuity Election

Form Approved:
OMB No. 3206-0168

You should read all of the information we have provided with this election form before you make your election
Name (last, first, middle)

CSA

Reference

Option 1A - Regular Annuity
Monthly to you

Monthly to survivor

$
$
This amount is the benefit you are entitled to receive based on the regular retirement formula. If you received a refund of Civil Service
retirement deductions for service which ended before October 1, 1990, and have not made a redeposit of that money, the rates shown
are actuarially reduced based on the amount you owe. If you performed non-deduction Civil Service Retirement System (CSRS) service
on or after October 1, 1982, or Federal Employees Retirement System (FERS) non-deduction service prior to 1989 for which a deposit
is owed, that service is not included.
I elect to receive the regular annuity benefit. I understand that my election cannot be changed any later than 30 days after the date of
my first regular annuity payment. I also understand that this annuity election precludes my eligibility to receive non-scheduled
compensation from the Department of Labor, unless and until all annuity payments are reimbursed to the Office of Personnel
Management (OPM).
Signature

Date (mm/dd/yyyy)

Option 1B - Regular Annuity If You Pay A Redeposit And/Or Deposit
Amount due

Annuity if payment is made
Monthly to you

Monthly to survivor

$
$
$
The amount shown is the benefit you are entitled to receive based on the regular retirement formula, if you pay the amount due.
Payment must be made in full now; installment payments will not be accepted.
I elect to receive the regular annuity benefit and to pay the amount due. My payment for the full amount due, made payable to the
U.S. Office of Personnel Management, is enclosed. I understand that my election cannot be changed any later than 30 days after
the date of my first regular annuity payment. I also understand that this annuity election precludes my eligibility to receive nonscheduled compensation from the Department of Labor, unless and until all annuity payments are reimbursed to OPM.
Signature

Date (mm/dd/yyyy)

Option 2 - Alternative Annuity With Lump-Sum Payment
Monthly to you

Monthly to survivor

Lump-sum payment to you

$
$
$
If you elect the alternative annuity, you will receive the lump-sum payment equal to all your retirement contributions shown above and
you will receive the monthly annuity indicated.
I elect to receive the reduced alternative annuity and the lump-sum payment equal to my retirement contributions. I understand that
my election cannot be changed any later than 30 days after the date of my first regular annuity payment. I also understand that this
alternative annuity election precludes my eligibility to receive non-scheduled compensation from the Department of Labor, unless and
until all annuity payments, including the lump-sump payment, are reimbursed to OPM. I certify that I do not have a former spouse
entitled by court order to receive a portion of my annuity or a survivor annuity based on my service.
WARNING: Any intentionally false or willfully misleading statement or response you provide in this election is a violation of the law
punishable by a fine of not more than $10,000 or imprisonment of no more than 5 years, or both. (18 U.S.C. 1001)
Signature

Date (mm/dd/yyyy)

If You Choose Option 2, You Must Have The Consent Of Your Spouse (or the person you were married to on the date you separated
for retirement). This means your spouse or former spouse must sign in the presence of a notary.
I freely consent to this alternative annuity election (including the level of survivor benefits shown above).
Signature of current or former spouse

Date (mm/dd/yyyy)

NOTARIZATION - To be completed by notary public or other official authorized to administer oaths.
I certify that the person whose signature appears immediately above presented identification (or was known
to me), gave consent to the specific election as executed by the retiree, signed or marked the form, and
acknowledged that the consent was given freely in my presence.
Signature

Expiration date of commission (mm/dd/yyyy)

(Seal)
Date (mm/dd/yyyy)

RI 20-80
Revised July 2012