As a general rule, military service is creditable to your CSRS retirement,

provided it was active duty and ended with an honorable discharge.

Waiver of military retired pay for

credit 

With few href="http://www.myfederalretirement.com/public/107.cfm">exceptions, employees

who are in receipt of military retired pay cannot receive credit for

their military service toward retirement eligibility or for the computation

of annuity unless military retired pay is waived.   The waiver does

not take effect until date of civilian retirement.  

If you do not waive your military retired pay, your retirement rights (and

those of your surviving spouse, if any) will be based on your civilian service

only and military service will not be included in computing the annuity. You may

then receive both your military retired pay and your civil service annuity at

the same time.

Click here to

view Deciding

Whether to Waive Military Retired Pay

Credit for military service prior January

1, 1957

• You will receive credit for military service

  performed prior to January 1, 1957, without making any

  deposit.   

• You will not have your annuity recomputed at age 62 even if you

  become eligible for Social Security benefits. (But if you also have military

  service after 1956, a reduction may be required as explained below).

   However, using the military service performed prior to January 1, 1957, in

  computing your CSRS retirement benfits will eliminate any credit you might

  have received from Social Security for that period of service.

Credit for military service after

1957

Beginning January 1, 1957 military service became subject to

Social Security. Treatment of military service under CSRS depends on whether it

was performed after December 31, 1956 (referred to as "post-56" military

service.)

Hired as CSRS before

10-01-82

• If you are eligible for Social Security Benefits at

  retirement or at age 62 and:

Deposit paid:  Your post-56 military service

will be credited for title (eligibility for retirement) and computation of the

annuity.  
 
Deposit not paid:  Your

post-56 military service will be credited for title.  If you are not

eligible for Social Security at retirement, but will become eligible at age 62,

your Post-56 military service will be credited for computation of your annuity

until age 62.  At that time the credit for post-56 military service is

eliminated.  Your annuity will be recomputed by subtracting the years of

post-56 service from the total number of years of combined civilian and military

service.  This typically reduces the CSRS annuity by 2% for each year of

Post-56 military service.  For example, an employee age 55 with 30 years of

combined service (4 years of which is post-56 military service) would be

eligible for retirement.  However, if he/she does not make a military

deposit and becomes eligible for Social Security at age 62, his/her annuity

would then be recomputed and reduced by 8% (4 years X 2% = 8%).  If you are

eligible for Social Security at the time of retirement (normally age 62 or

older), the post-56 service will not be used in the computation of your

annuity.

• If you will not be eligible for

  Social Security at 62 (or retirement, if later)

No deposit is required and you will receive full credit for

post-56 military service with no future reduction.

 Hired as

CSRS on or after 10-01-82:

A deposit is required to receive credit

for retirement eligibility and annuity computation

purposes.

How is your military "buy-back"

deposit computed?

The deposit equals 7% of base pay (not allowances earned

during the post-56 military service).  The earliest interest begins to

accrue is October 1, 1986 or your 3rd anniversary of entry into a CSRS position.

 
As with civilian deposits, href="http://www.myfederalretirement.com/public/105.cfm">variable rates of

interest are assessed.  No interest is charged if you pay the deposit,

in full, before the first interest accrual date (IAD).