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FERS annuity supplement
Old 05-02-2014, 05:08 PM   #1
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FERS annuity supplement

Something just occurred to me as I was out trying to kill dandelions today.

1. I was planning on moving over $30,000-35,000 of my TSP to a ROTH over the next couple of years and just pay the 15% tax now.
2. I got a letter yesterday from OPM wanting me to confirm how much I earned since my annuity would be reduced like Social Security if I make over $15,480.
3. My pension and the annuity itself doesn't seem to count.

If I convert that $30K+ over to a ROTH wouldn't that bump my earnings for the year up well over the limit and then I would start losing $1 of every $2 over that $15,480 limit.......which would mean I would lose half of my annuity. Do I have this right? In which case, moving the money to the ROTH might not be a smart thing to do.
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Old 05-02-2014, 07:48 PM   #2
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I am under the old CSRS system and do not know very much about FERS. However, with Social Security, it is the amount of earned income and not unearned income. Earned income is through employment or self-employment.

I just want to stress again that I don't really know about the FERS system. Hopefully, someone else will answer you or call OPM.
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Old 05-02-2014, 08:13 PM   #3
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Quote:
Originally Posted by Dreamer View Post
I am under the old CSRS system and do not know very much about FERS. However, with Social Security, it is the amount of earned income and not unearned income. Earned income is through employment or self-employment.

I just want to stress again that I don't really know about the FERS system. Hopefully, someone else will answer you or call OPM.
Thanks...that would make a BIG difference if the TSP money is considered unearned . I don't know how they would treat that TSP deferred tax money. It is money that I earned......just to be put off until later to pay the taxes and use it. I really don't want to call OPM again. Just going through a problem with them. They gave me $500 a year ago for no reason. They figured it out and wanted it back. I paid it back in August. Since then I have had 3 people tell me the problem has been solved. But.....come on, it's the Govt......they are still taking the money out and they that they will pay it back to me in June. Yeah......
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Old 05-02-2014, 08:24 PM   #4
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See "Definition of Earnings" on page 13 of this link. Earnings "consist of the sum of wages for service performed in the year, plus all net earnings from self-employment for the year, minus any net loss from self employment from the year." TSP withdrawals aren't earnings in this sense.

https://www.opm.gov/retirement-servi...ets/ri90-8.pdf
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Old 05-02-2014, 08:36 PM   #5
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See "Definition of Earnings" on page 13 of this link. Earnings "consist of the sum of wages for service performed in the year, plus all net earnings from self-employment for the year, minus any net loss from self employment from the year." TSP withdrawals aren't earnings in this sense.

https://www.opm.gov/retirement-servi...ets/ri90-8.pdf
Thanks. That does seem to solve the problem and would let me move the TSP money over to a ROTH.
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