CSRS survivor annuity upon death of survivor

[anethum]

My mom was receiving a CSRS survivor annuity until her death this year. Like Social Security payments, it is paid one month in arrears. She died at the beginning of a month and her checking account received electronic deposits for both her Social Security and CSRS annuity the day after she died. 4 days later, the bank returned both sums to the federal government. I'm handling the estate.

It is exceedingly difficult to reach anyone at OPM or Social Security. OPM opens their phone lines at 7:40am ET. The only way I could get in the queue was if I called at exactly 7:40am. I reached a human on 5 occasions. All of them thought my mom was entitled to the CSRC payment for the month preceding her death that the bank had returned. But they differed on what to do and how long it would take. In the 2nd call, the OPM employee told me she was sending a message to the OPM department which handles re-payments. Subsequent calls gave me differing times for how long it would take that dept., one saying up to 9 months, another saying 3 to 4 weeks. I had no means of contacting the branch of OPM which handles repayments.

After a few months of getting no further information about my claim, I contacted my member of Congress. I received a reply today citing the following line in civil service regulations:

"(c) A survivor annuity terminates at the end of the month preceding death or any other terminating event."

I find that language quite vague. My interpretation is that my mom was still entitled to the payment returned by the bank. Indeed all 5 OPM employees I spoke with on the phone seemed to think so, too, but differed about how to get it and how long it might take. The message forwarded by my congressman's office says she is not entitled to that payment. Has anyone here dealt with a similar situation following the death of a parent?

As for Social Security, after waiting on hold for 90 minutes, I reached a person who said my mom was entitled to the payment which the bank returned to the govt. She sent me a form to fill out which I mailed to the local Social Security office. A different person in my congressman's office forwarded me a reply from S.S. with no additional information about the claim:

“The forms were received, and they have been sent to PC" (PC = Program Service Center)

 

[audreyh1]

So did the bank initiate these returns?

Fortunately I didn’t run into this problem when DF died. When I called to report they explained that SS was paid in arrears and that only the following month check would be clawed back if accidentally deposited.

 

[N02L84ER]

When my MIL died in June of 2020, the bank sent her final SS check back. We contacted SS, filled out the necessary beneficiary paperwork, and the 2 beneficiaries got their checks in mid August. I have no experience with CSRS.

 

[anethum]

So did the bank initiate these returns?

Yes. I hadn't even notified the bank of my mom's death because it's a joint checking account in her name, my name, & a sibling's name. So it's still an active account. I've been using it for years to pay my mom's expenses, including the funeral expenses after her passing, as well as ongoing expenses. I notified OPM of my mom's death, however, and the funeral home told me that they notify Social Security of deaths.

I filed a complaint with the bank and someone at the bank's headquarters called me and told me they were simply following "government rules". I asked for those supposed rules in writing and never got a response.

For the time being, Social Security seems to be acting as though my mom's estate is entitled to have that final month's payment re-issued.

 

[anethum]

When my MIL died in June of 2020, the bank sent her final SS check back. We contacted SS, filled out the necessary beneficiary paperwork, and the 2 beneficiaries got their checks in mid August. I have no experience with CSRS.

Thanks. Your experience makes me think that mom's final SS check will be re-issued.

I'm not convinced that the annuity won't ultimately be re-issued as well. The left hand doesn't seem to know what the right hand is doing at OPM, and they seem to be even more understaffed than SS.

 

[clobber]

Sorry for your loss and all the craziness you have to go through. I'm not an expert on the subject, but I can point you to what I think is the definitive documentation:

Here is a link to Chapter 70 of the CSRS/FERS Handbook On page 11 there is Section 70A2.2-1 which applies to CSRS and is titled "Duration of Survivor Benefits." It says, "A survivor annuity to a widow or widower ends on the last day of the month preceding the month in which he or she dies."

Here is an OPM link that has a small paragraph on deceased survivors. It corroborates what the handbook says. Finally, here is a second OPM link that says, "All payments received from OPM after the annuitant's date of death must be returned to the Treasury Department."

 

[anethum]

Thank you, clobber. That is far clearer than what OPM sent my congressman.

 

[anethum]

I thought this was over, but apparently it's not. I just returned home after being away for nearly a month, and OPM sent me a snail-mail letter which was delivered after I left. The letter to me stated that the bank returned my mom's final survivor pension check by mistake. The letter to me includes the following statements:

"When these payments are erroneously returned, we cannot pay them to an individual or estate. The amount of the annuity has been removed from the financial institution's total funds, so it needs to be resent to them. Once a response is received on how to return these funds to <my mom's bank>, we will forward the funds directly back to the financial institution."

They also enclosed a copy of the letter sent to the bank dated a month ago, including the following:

"We need you to advise us how it should be resent to you. Please send us this guidance on your business letterhead."

I will notify my congressman's office on this latest wrinkle, which conflicts with what someone at OPM told a staffer in my congressman's office.

Meanwhile, I have received no communication from the bank (a large nationwide bank). I will contact them on Monday, and this time attempt to email the CEO and regional president.

I have heard nothing further from Social Security.

 

[anethum]

Victory!

My mom's checking account was credited this week with a full month's pension amount for the month before my mom died. Someone from OPM called me about 5 weeks ago to tell me she had authorized the payment, but that it usually takes about 3 weeks before the money is actually transferred. She also mentioned that she currently had 15 similar federal pension cases on her desk that my mom's bank had erroneously returned to the government.

About a week ago, the checking account was credited with exactly half of mom's normal monthly Social Security amount she had been receiving this year before her death. I received a form letter today from Social Security about the payment, but it didn't mention or explain the amount. The regular monthly pension amount was about 10 times the size of the regular Social Security amount, so I'm not going to sweat this small missing amount. It's not worth my time. But I'll be curious to see the tax document Social Security will mail out in January. With such a small monthly S.S. check, it makes no sense that they'd withhold 50% in federal & state income taxes. My mom's huge caregiving expense meant that due to her medical deduction, she hadn't owed any federal or state income tax since her 24/7 care began. I had reduced her withholding to zero.

 

[MichaelB]

Victory!

My mom's checking account was credited this week with a full month's pension amount for the month before my mom died. Someone from OPM called me about 5 weeks ago to tell me she had authorized the payment, but that it usually takes about 3 weeks before the money is actually transferred.

Glad your perseverance paid off.

 

[anethum]

About a week ago, the checking account was credited with exactly half of mom's normal monthly Social Security amount she had been receiving this year before her death.

It turns out my sibling received a check for the same amount. I had forgotten that the form I had to fill out for Social Security asked for the names and addresses of all offspring of the deceased. So 100% of the annuity and Social Security payments returned by the bank have been repaid.