Chapter 7: Divorce, Legal Separation, and Annulment
- By Almanac Staff
- Jan 03, 2013
Basic Effects of Divorce or Separation
Broadly speaking, a court order related to a federal or postal employee’s divorce, annulment, or legal separation can:
• divide a Civil Service Retirement System (CSRS) or Federal Employees Retirement System (FERS) annuity;
• block payment of or divide a refund of CSRS or FERS employee retirement contributions;
• award or divide a lump-sum FERS basic death benefit if a FERS employee dies while still employed;
• provide a survivor annuity payable upon the death of an employee or retiree;
• permit a former spouse to continue health insurance coverage under the Federal Employees Health Benefits (FEHB) program;
• require employees or retirees to assign their Federal Employees’ Group Life Insurance (FEGLI) coverage to a former spouse or children;
• require an employee to name his or her former spouse and/or children as beneficiaries under FEGLI; and
• require payment to the former spouse from a Thrift Savings Plan (TSP) account.
In addition, a court order may require that a federal employee’s pay or retirement benefits be garnisheed for alimony or child support or in cases involving child abuse.
Special rules and procedures apply to divorce and similar proceedings involving federal and postal benefits. At the outset, it is essential to recognize that the TSP and federal retirement programs are exempt from the Employee Retirement Income Security Act (ERISA), which generally governs marriage-related court orders affecting private-sector workers. Thus, court orders that are commonly used to divide private-sector benefits, called “Qualified Domestic Relations Orders” (or QDROs), might not be valid in proceedings involving federal or postal employees or retirees. If a court issues its order in the form of QDRO, the order may be acceptable for Office of Personnel Management (OPM) processing if the court specifically states that it has considered the terminology and requirements of the federal employee benefit laws and regulations and that the terms and provisions of the order “are governed by the standard conventions” of those federal employment laws and rules.
Similarly, benefit allocations commonly used under ERISA may not be allowable or acceptable for OPM processing purposes. For example, under ERISA, a former spouse’s share of a retirement benefit can begin when the employee reaches the minimum retirement age, even if the employee is still working. However, this arrangement is not available under the CSRS or FERS systems, both of which refuse to allow court orders to affect a retirement benefit until the benefit is actually payable to the retired employee. The TSP also has special rules for distributions from TSP accounts under which standard court orders might not achieve the desired effect.
There are also differences in policies regarding the designation of beneficiaries in defined contribution retirement savings plans such as the TSP and 401(k)s.
Likewise, it is important that any court orders or agreements intended to award a survivor annuity reflect the intent of the parties and conform to law and regulations. While court orders can be changed before the employee retires or dies, in general they cannot be modified to affect survivor benefits once the employee dies or has retired.
During the early stages of any legal proceedings, individuals involved in a divorce or marital separation also need to know how to obtain relevant information. For example, to get necessary information about an active employee’s work history, pay, or other required information, the employing agency, not OPM, normally is the proper source of information about the worker’s service with that agency. However, if the worker’s federal employment history includes previous service with a different agency, information about the individual’s retirement fund contributions for the earlier service is held at OPM.
For retirees and separated employees, OPM is the appropriate source for information similar to that available from individual agencies about active employees. OPM also has annuity rate information about retirees. OPM will release such information only in response to a subpoena signed by a judge or a release signed by the retiree or former employee. The subpoena or release should be sent to: Associate Director, Retirement and Benefits, OPM, 1900 E St., N.W., Room 4312, Washington, DC 20415.
Requested information that an employing agency can provide in response to a subpoena signed by a judge, or a release signed by the employee, includes a statement of retirement system coverage, amount of money withheld by the agency to the employee’s credit in the retirement fund, and an annuity estimate using service to date. The requirements for obtaining information vary among agencies.
Agencies can prepare estimates of benefits that the employee has already earned. However, such estimates are not considered binding on the government. Also, an employing agency will not provide estimates that would require speculation about events such as promotions. Nor will it determine the “present value” of employee entitlements since they involve various economic and mortality assumptions.
Likewise, the government will not become involved in determining the proper division of benefits between spouses. To guide attorneys in preparing court orders, OPM has published a Handbook for Attorneys on Court Ordered Retirement, Health Benefits, and Life Insurance, at http://archive.opm.gov/retire/pubs/pamphlets/ri83-116.pdf. Further information is at www.opm.gov/faqs (search for “divorce”).
Note: Divorces of same-sex spouses who were married in jurisdictions that recognize such marriages are treated in the same manner as divorces of opposite-sex spouses. That policy took effect July 3, 2013 following the U.S. Supreme Court decision in United States v. Windsor (133 S. Ct. 2675) that ended the definition of marriage, for federal benefits purposes, as only between a man and a woman, See Benefits Administration Letter 13-203 at www.opm.gov/retirement-services/publications-forms/benefits-administration-letters.
A divorce is a “qualifying life event” that allows certain changes in benefits, as described below and in Chapter 1, Section 9 and Chapter 2, Sections 1, 2 and 4.
Effect on Designations of Beneficiary
A divorce does not affect a designation of beneficiary that was filed at an earlier time. An employee or retiree who has designated a now-former spouse to receive life insurance, retirement lump-sum benefits or proceeds of a Thrift Savings Plan account must file new designations for any benefits that become payable to go to someone else. Designations of beneficiary may be changed at any time except that under life insurance, you cannot change the beneficiary designation if the policy was assigned.
The life insurance designation of beneficiary for both retirement systems is SF 2823. To designate a beneficiary for any lump-sum benefit that may remain after a retiree’s death, the CSRS form is SF 2808 and the FERS form is SF 3102. The forms are available at www.opm.gov/forms; employees also may obtain them through personnel offices and retirees may obtain them by calling (888) 767-6738 or (724) 794-2005. To change a TSP beneficiary designation, file a new Form TSP-3, available at agency personnel offices, at www.tsp.gov/forms/formsPubs.shtml, or by calling (877) 968-3778 from the United States and Canada, (404) 233-4400 from elsewhere.
If you have not filed a designation of beneficiary, payments will be made according to a standard order of precedence. For lump-sum benefits, see Death Benefits When No One is Eligible for Survivor Annuity in Chapter 3, Section 4; for life insurance, see FEGLI Beneficiaries: Order of Precedence in Chapter 2, Section 2; for the TSP, see Beneficiary Designations in Chapter 6, Section 6.
Effect on Insurance Coverage
FEHB—If you have a self and family Federal Employees Health Benefits program enrollment, your spouse is eligible to continue coverage under your enrollment while you are legally separated or in the process of getting a divorce or an annulment. After the date the divorce or annulment is final, your ex-spouse is eligible for a 31-day extension of coverage but cannot remain covered as a family member under your self and family enrollment. Your ex-spouse may be eligible to enroll under spouse equity, or temporary continuation of coverage, or convert to an individual policy with your carrier.
If you have a self and family enrollment and there are no other eligible family members, the divorce is a qualifying life event; within 60 days of the date of your divorce or annulment, you can change to a self-only enrollment. At the same time, you can change plans or options. If you have a self and family enrollment and other eligible family members remain on the enrollment, you still must contact your FEHB plan to let it know the date of the divorce or annulment and have your ex-spouse removed from coverage.
Also see Section 3 below and Changes Outside of Open Season in Chapter 2, Section 1.
FEGLI—Unless you’ve assigned your Federal Employees’ Group Life Insurance coverage, you can reduce or cancel coverage at any time. Benefits may also be paid based on a valid court order. If you have Family (Option C) insurance and don’t cancel it, coverage continues on your spouse until the marriage is terminated. Afterward, Option C benefits are not payable on the ex-spouse even if you continue to pay premiums, although they would remain payable on any eligible dependents. You also can change your designation of beneficiary at any time without prior notice to any beneficiary unless the policy has been assigned.
Also see Section 4 below and Adding Coverage in Chapter 2, Section 2.
FLTCIP—A change in marital status does not affect your coverage or premiums under the Federal Long Term Care Insurance Program. If you are currently paying the premiums for your spouse, contact LTC Partners to make other billing arrangements. A divorced spouse may keep coverage by continuing to pay the premiums, but may not first apply after the divorce unless otherwise eligible, for example as a federal employee or retiree himself or herself. Children of an eligible employee or retiree may continue or take out coverage at age 18 or above. A court order related to a divorce or separation cannot make a former spouse qualified to enroll in the FLTCIP.
Also see Chapter 2, Section 3.
FEDVIP—If your spouse is currently covered under your Federal Employees Dental and Vision Insurance Program enrollment, that coverage will continue until the date of divorce or until the effective date of an open season change. You cannot remove your spouse outside of an open season just because you are separating or in the process of divorce. Once you are divorced, your ex-spouse will not be eligible as a family member under your enrollment in FEDVIP. There is no spouse equity, temporary continuation of coverage, or the right to convert to an individual policy in FEDVIP. Nor may a former spouse first apply after the divorce unless otherwise eligible, for example as a federal employee or retiree himself or herself. A divorce is a qualifying life event that allows enrollees to decrease the level of coverage (for example, from self plus one to self-only) at any point after the divorce.
A court order related to a divorce or separation cannot make a former spouse of an employee or annuitant eligible for FEDVIP or require an agency or retirement system to enroll an employee or annuitant in a FEDVIP plan to cover his or her children.
Children continue to be covered under self and family or self plus one coverage, so long as they meet other eligibility rules.
Also see Chapter 2, Section 4.
In the event of a divorce, separation, or annulment, the most common ways that the courts divide a federal worker’s retirement benefits are awards to the former spouse of payments from a retiree’s monthly annuity, a portion of an employee’s refund of retirement contributions, and rights to a survivor annuity. Awards of “insurable interest” annuities also sometimes are made.
OPM has detailed requirements for those types of court orders it considers acceptable for processing. OPM will not honor court awards that don’t comply with those rules or with underlying federal law (which generally takes precedence over state law). For example, state courts lack the authority to prevent OPM from paying a retired employee an annuity that is required by law—or to delay the payment of such annuities. On the other hand, OPM will honor court orders that direct it to pay the annuity to the court, an officer of the court acting as a fiduciary, or a state or local government agency pending the outcome of a divorce or legal separation proceeding.
The address for delivery of court orders affecting retirement benefits is Office of Personnel Management, Court Ordered Benefits Branch, P.O. Box 17, Washington, DC 20044-0017, phone (888) 767-6738 or (724) 794-2005 (ask for that branch).
OPM must comply with the terms of a properly filed court order for processing, even if the retiree and the former spouse agree that they want OPM to pay an amount different from the amount specified in the court order. Thus, OPM will not honor a request from a former spouse, a retiree, or both jointly that an amount either greater or less than the amount provided in the court order be withheld from an employee annuity or a refund of employee contributions to the retirement fund. Any change requires that an amended court order be filed with OPM.
Payment of Portion of Retiree’s Annuity
A court order can apportion or divide a CSRS or FERS retirement benefit as a result of a divorce, legal separation, or annulment of marriage. The court order must expressly direct OPM to pay a portion of the retiree’s monthly CSRS or FERS benefits to the former spouse. The spouse’s share must be stated as a fixed amount, a percentage or fraction of the annuity, or in terms of some other formula whose value is readily apparent from the face of the order and information in the government’s files. The spousal share cannot exceed the amount payable to the retiree after deductions for taxes and insurance.
Only payments made after OPM receives the court order will be divided between the employee and his or her former spouse. OPM will not execute a court order dividing a federal employee's retirement annuity until the employee has separated from federal service, is eligible for an annuity, and has applied for an annuity.
A former spouse’s right to apportionment payments from a retiree’s annuity ends with the retiree’s death. For the former spouse to continue receiving payments after the retiree’s death, the retiree must elect, or the court order must provide for, a survivor annuity.
The federal government generally makes payments from an annuity only when all conditions necessary for payment of the annuity are met, including a worker’s separation from a covered position with immediate eligibility for an annuity and the employee’s submission of an annuity application. Money that is held by an employing agency or OPM and that may be payable at some future date is not available for payment under court orders directed at annuities.
A former spouse, personally or through a representative, must apply to OPM in writing to be eligible to begin receiving a court-awarded portion of an employee annuity. No special form is required, but the application must include a certified copy of the court order, the individual’s certification that the order is currently in force, information sufficient for OPM to identify the employee or retiree, and current mailing addresses of the former spouse and the annuitant. When the court order requires termination of the payments if the former spouse remarries, OPM also needs a statement certifying that a remarriage has not occurred, that the former spouse will notify OPM within 15 days of any remarriage, and that the former spouse will be personally liable for any overpayment resulting from a remarriage.
To be acceptable to OPM, a court-ordered award of spousal benefits must expressly divide the employee annuity, provide for payment of the apportioned share to the former spouse, and provide OPM with sufficient information to compute the amount of the former spouse’s monthly benefit. The amount must be expressed as a fixed amount, a percentage or fraction of the annuity, or in some other readily understandable formula. OPM prefers that such orders specify that it make the payments directly to the former spouse, although a court order directing the employee or separated employee to arrange for OPM to pay the former spouse also is considered acceptable.
If the order awards a former spouse a lump-sum amount from the annuity and does not state a monthly rate at which the lump sum should be calculated, OPM will pay the former spouse equal monthly installments of 50 percent of the gross annuity until the lump-sum amount is paid in full.
The former spouse’s share will be increased by the same cost-of-living adjustment formula that governs cost of living increases for the retiree’s annuity. See Chapter 4, Section 3.
Payments to the former spouse will be discontinued if the retiree’s annuity payments are suspended or ended. If the individual’s annuity payments are later restored, payments to the former spouse also will resume under the terms of a court order that is in effect at that time. However, a retiree may not deprive a former spouse of payment by causing suspension of payment of the annuity.
A former spouse’s portion of an annuity typically ends on:
• a date on which the court order requires termination;
• the issuance of a court order invalidating the original order or amending it to stop payment; or
• the death of the retiree or (in most cases) the former spouse.
OPM will honor a court order that directs it to continue paying a former spouse’s share after such individual’s death in the form of payments made to the court, an officer of the court, the former spouse’s estate, or one or more of the retiree’s children. However, it will not honor an order directing it to continue annuity payments to the former spouse after the death of the retiree, absent express language granting the former spouse survivor annuity rights.
Refunds of Retirement Contributions
A court order may provide for payment of all or part of a refund of an employee’s retirement plan contributions to the worker’s former spouse. A court order also may block payment of a refund to the employee, but only if the order also grants a survivor annuity or a portion of a retiree annuity to a legally separated or former spouse.
Refunds of employee contributions are payable only if all of the conditions necessary for payment of the contributions to the separated employee have been met. Generally, these include the individual worker’s separation from a covered position, application for payment of the refund, and immediate entitlement to a refund.
A former spouse, personally or through a representative, must apply in writing to be eligible for a court-awarded portion of a refund of an employee’s retirement contribution. No special form is required, but the application letter must be accompanied by a certified copy of the court order, a certification that the court order is currently in force, information sufficient to identify the employee or separated employee, and current addresses of both the separated employee and former spouse.
Generally, OPM must receive the documentation no later than the last day of the second month before payment of the refund. If the documentation is incomplete, OPM will notify the former spouse and require full documentation within 15 days.
A court order dividing a refund of employee contributions must expressly award a former spouse a portion of any refund, identify the retirement system affected, and provide OPM with sufficient information to compute the former spouse’s share. The specified portion can be expressed as a fixed amount, a percentage or fraction of the refund, or in another readily understandable formula. OPM will not accept an order that requires it to examine or interpret a state statute or a court decision on a different case to compute the former spouse’s share. OPM prefers that orders specify that it make the payments directly to the former spouse, although an order directing the employee or separated employee to arrange for OPM to pay the former spouse is acceptable.
A court order barring payment of a refund will be honored only if it expressly directs OPM not to pay a refund of employee contributions it awards, or a prior court order has awarded the former spouse a survivor annuity or a portion of the employee’s annuity; and payment of the refund to the employee would prevent a required payment to the former spouse under an order for a survivor annuity or a portion of the employee’s annuity.
Survivor Annuity to Former Spouse
A monthly survivor annuity may be payable to a former spouse after the death of the employee or annuitant if provided by court order. An employee or retiree is required to provide such an annuity if such payments are stipulated in a divorce agreement or annulment ending a marriage after May 6, 1985. The provision of a former spouse survivor annuity results in a reduction to the retiree’s monthly benefit amount.
A retiring employee may voluntarily elect to provide a survivor annuity to a former spouse. However, if the employee has remarried, this voluntary election may only be made if the worker’s current spouse consents to it.
Court orders must expressly award a former spouse a survivor annuity or expressly direct an employee or retiree to elect to provide a former spouse with a survivor annuity. As with the other types of spousal benefits, the court’s award must provide sufficient information so that OPM can determine the amount of the former spouse’s monthly benefit, using only the express language of the court order. Orders that would require OPM to examine or interpret a state statute or a court decision on a different case to compute the former spouse’s share are unacceptable.
In cases where an actively employed individual dies, a court-ordered survivor benefit is payable to a former spouse if the deceased employee has completed at least 18 months of creditable civilian service, and dies while enrolled under CSRS or FERS coverage. Under CSRS, a survivor annuity is payable to the former spouse. Under FERS, a lump sum death benefit is payable, and a survivor annuity also is payable if the employee had at least 10 years of creditable service.
OPM will not honor court awards awarding lump-sum payments (other than the FERS basic employee death benefit, which may be paid to a former spouse or divided between a current and former spouse, pursuant to a state court order) to a former spouse upon the death of an employee or retiree. Nor will it honor awards allowing the retiree or former spouse to pay for the reduction in a retiree’s annuity by any means other than withholding from the annuity.
A court order awarding a survivor annuity to a former spouse of an employee will not be honored by OPM if the former spouse previously waived his or her right to a survivor annuity.
The maximum possible combined totals of all current and former spouse survivor annuities are 55 percent of the self-only annuity amount payable under CSRS or 50 percent of the amount payable under FERS. Thus, a court order awarding a survivor annuity to a former spouse invariably reduces the amount that can be paid to a current spouse of the employee or retiree at the time of death. This means that if the maximum percentage of an annuity (55 percent under CSRS and 50 percent under FERS) has been awarded to a former spouse (or former spouses, if the worker had more than one), the employee’s current spouse will not receive any survivor benefit (unless the former spouse loses entitlement to benefits due to death, remarriage before age 55, or under the terms of a court order). If less than the maximum percentage has been awarded, a current spouse will be entitled to a survivor benefit that amounts to the difference between the maximum survivor annuity permitted and the amount allocated to a former spouse. The current spouse’s entitlement would increase if the former spouse loses entitlement. Survivor annuities to former spouses are increased according to the same cost-of-living adjustment formulas applied to the CSRS or FERS annuity.
A former spouse’s survivor annuity continues for life unless entitlement is lost due to the individual’s remarriage before age 55 or under terms of the court order. An annuity to a former spouse that ends due to an individual’s remarriage cannot be restored, even if that marriage ends in divorce (unless the qualifying marriage lasted for at least 30 years) or annulment (unless the annulment is based on a determination that the marriage was not legal).
Insurable Interest Annuity
An insurable interest election can be made at retirement to provide a current or former spouse with additional survivor benefits if the retiree is in good health and no court order prohibits it. Choosing this option causes an additional reduction in the retiree’s annuity that is based on the difference in ages between the retiree and the named beneficiary. When an insurable interest survivor annuity stops because the beneficiary dies, it has no effect on any other survivor annuity. An insurable interest annuity to a former spouse continues for life regardless of remarriage.
Garnishment of Benefits
Garnishment is a legal process under state law for enforcing existing legal obligations. Benefits under CSRS or FERS can be garnisheed only for alimony, child support, or in cases of child abuse. The garnishment must conform to all state law requirements for garnishment actions involving private employers, and is subject to the limitations in 5 CFR 581. For further information, see Section 6 in this chapter.
As noted above, the maximum possible combined total of all current and former spouse survivor annuities equals 55 percent of the rate of a self-only annuity under CSRS. The maximum possible annuity is 50 percent under FERS. A court order awarding a survivor annuity to a former spouse reduces the maximum that can be paid to the spouse married to the annuitant at the time of death. An insurable interest election can be made at retirement to provide a current spouse with additional survivor benefits if the retiree is in good health.
It is very important that provisions intended to award a survivor annuity both reflect the intent of the parties and conform to law and regulations. While orders can be changed before the employee retires or dies, in general they cannot be modified to affect survivor benefits after the employee retires or dies.
State court orders cannot affect several types of benefits payable under CSRS and FERS. OPM must pay any accrued annuity that is not paid before a retiree’s death and any unexpended balance of an employee’s retirement contributions that are paid as a death benefit in accordance with the order of precedence established by federal law. Similarly, eligibility for children’s survivor benefits is governed entirely by federal law and cannot be affected by state court orders.
Orders Affecting Military Retired Pay
Receipt of military retired pay often bars credit for the military service for CSRS or FERS unless the retiring employee elects to waive the military retired pay and have the military service added to civilian service in computing the civilian annuity. If the employee’s military retired pay is subject to a court order awarding a former spouse a portion of the military retired pay, the retiring employee cannot receive credit for the military service for CSRS or FERS without first consenting for OPM to continue payment to the former spouse. OPM must pay the amount the military pay center would pay the former spouse if military retired pay continued.
OPM’s General Process
OPM authorizes retirement benefit payments to former or separated spouses according to provisions of court orders it considers acceptable for processing under applicable law and regulations. If OPM views the order as not acceptable, the parties must return to state court to seek modifications.
To claim court-ordered benefits from OPM, former spouses (or their legal representatives) are responsible for:
• filing a certified copy of the court order and all other required supporting information with OPM;
• keeping OPM advised of current mailing addresses of both the former spouse who is claiming benefits and the federal employee/retiree whose benefits are being affected;
• notifying OPM of any changes in circumstances that could affect the individual’s entitlement to benefits; and
• submitting all disputes with the employee/retiree to the appropriate state court for resolution.
Once OPM determines that a court order is acceptable, the agency will do the following:
• inform the former spouse that the court order is acceptable, when spousal benefits will begin to accrue (if known), how much the monthly benefit will be and how it was computed, and that if the individual disagrees, a clarifying court order must be obtained; and
• inform the employee, retiree, or other interested party that the former spouse has applied for benefits, that the court order is acceptable for processing, when payment will commence (if appropriate), and in what amount and computed under which formula. Individuals who want to contest the validity or amount must submit a court order that either invalidates or amends the one submitted by the former spouse.
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Impact on Health Insurance Coverage
General Eligibility Rules
A former spouse who is awarded a portion of a CSRS or FERS annuity or a survivor annuity by a qualifying court order, even though the benefit is not yet payable, may be eligible to enroll for health benefits coverage under the FEHB program under the spouse equity provision. However, the former spouse is not eligible to retain coverage under the employee’s or retiree’s own family enrollment. FEHB coverage may also be temporarily continued under the temporary continuation of coverage authority; see Temporary Continuation of Coverage in Chapter 2, Section 1.
(Note: Coverage under spouse equity or TCC qualifies for purposes of avoiding penalties under the Affordable Care Act, Public Law 111-148, for those who do not have health insurance coverage on themselves and their dependents that meets certain standards. See FEHB Eligibility and Enrollment Rules in Chapter 2, Section 1.)
A former spouse’s continued entitlement to FEHB coverage is based on the court order requirements for a former spouse annuity. Children’s eligibility for FEHB coverage is controlled by federal law and cannot be affected by a state court order.
A court order granting the former spouse a portion of the retiree’s annuity provides the former spouse with a monthly payment after the employee retires and continued FEHB coverage until the employee dies. A court order that grants a survivor annuity provides the former spouse with continued FEHB coverage until the former spouse dies, but the annuity does not begin until the employee/retiree dies. A court order providing a portion of the retirement annuity and a survivor annuity ensures an annuity payment from the date of retirement or death and continued FEHB coverage until the former spouse dies.
Individuals who qualify as a former spouse must enroll in FEHB coverage in their own right and must pay both the employee’s and the government’s share of the premium. Those who are receiving survivor annuity benefits will have the premium cost withheld from the annuity; otherwise the former spouse must pay the cost of such health coverage directly to the OPM.
For a former spouse of an active or retired employee to continue FEHB coverage after a divorce, four basic requirements must be met. The former spouse must:
• have been covered as a family member under the employee/retiree’s FEHB enrollment for at least one day during the 18 months before the end of the marriage;
• be entitled to receive a portion of the retirement annuity after the employee retires or a survivor annuity at the time the employee/retiree dies;
• within 60 days after the end of the marriage, apply to the employment office of the agency where the employee worked and provide written notice that he or she wants to continue FEHB coverage under the spouse equity provisions of the FEHB law. If the marriage ended after retirement, that notice must be sent to OPM’s retirement system; and
• not remarry before age 55.
If both parents are eligible for FEHB coverage (for example, if both are federal employees), children are entitled to receive benefits under only one enrollment. If there is a reason for both parents to enroll in self and family coverage (for example, if both parents remarry and need to cover their new spouses and any stepchildren), each enrollee must notify his or her insurance carrier of the name(s) of the child(ren) to be covered under his or her enrollment.
Court-Ordered Benefits for Children—Public Law 106-394, 114 Stat. 1629, mandates compliance with court or administrative orders requiring federal employees to provide health benefits for their children. Under 5 CFR Parts 890 and 892, a federal employee subject to such an order must enroll for self and family coverage in a health plan that provides full benefits in the area where the children live or provide documentation to the agency that he or she has obtained other health benefits for the children.
If the employee does not do so:
• if the employee has no FEHB coverage, the agency will enroll him or her for self and family coverage in the option of the Blue Cross and Blue Shield Service Benefit Plan that provides the lower level of coverage;
• if the employee has a self-only enrollment in a fee-for-service plan or in an HMO that serves the area where all the children live, the agency will change his or her enrollment to self and family in the same option of the same plan;
• if the employee is enrolled in an HMO that does not serve the area where all the children live, the agency will determine if a reciprocity agreement will cover all the children (a reciprocity agreement allows enrollees of one HMO to receive services from another HMO). If a reciprocity agreement between the employee’s HMO and another plan would cover each child, the employee may remain in his or her HMO. If there is no such agreement, the agency will change his or her enrollment to self and family in the lower option of the Blue Cross and Blue Shield Service Benefit Plan.
An employee involuntarily enrolled in the Blue Cross and Blue Shield may change to another plan if the employee was prevented from enrolling or changing enrollment within the 60-day time frame due to circumstances beyond the employee’s control. Agencies are responsible for deciding whether the employee’s failure to make a timely election was beyond the employee’s control. Generally, an error in judgment or failure to read information is not considered beyond the employee’s control. An employee has 60 days from the date notified of an allowance to enroll in another FEHB plan. The change is effective on a prospective basis only.
As long as the court or administrative order is in effect, and the employee has at least one child identified in the order who is still eligible under the FEHB program, the employee cannot cancel his or her enrollment, change to self-only, or change to a plan that does not serve the area in which the child or children live, unless he or she provides documentation that he or she has other coverage for the children. If the court or administrative order is still in effect at the time the employee retires, and if at least one child is still eligible for FEHB, the employee must continue FEHB into retirement (if eligible) and cannot make any of these changes after retirement for as long as the order remains in effect and the child continues to be eligible.
If such an employee goes into an unpaid status, or if his or her salary becomes insufficient to make the premium withholdings, he or she must continue the coverage and either make direct premium payments or incur a debt to the government. If the annuity of an employee who remained subject to such a court or administrative order upon retirement becomes insufficient to make the premium withholdings, the annuitant must continue the coverage and make direct premium payments for as long as the order remains in effect and the child continues to be eligible.
Employees who are subject to a court order to provide health benefits for their children and who are eligible to continue their coverage into retirement cannot make any changes that would affect their children’s FEHB coverage after retirement. That is, the retiree cannot make an enrollment change to a self-only plan, cancel or suspend enrollment, or change to an HMO that does not serve the area where each child lives. Retirement systems personnel will flag the retiree’s file so that the retiree cannot make such a change.
Federal agencies will respond to a National Medical Support Notice, which provides a standardized format of instructions concerning an employee’s obligation to provide health insurance coverage for one or more children.
General Coverage Procedures
Coverage begins on the first day of the pay period after the agency’s employment office or the retirement system receives all properly completed qualifying documents—i.e., a Standard Form 2809 or a signed statement with enough information to execute enrollment—and satisfactory proof of eligibility. Former spouses whose divorce occurred during the spouse’s federal service should contact the employing agency, while former spouses whose divorce occurred after the spouse’s retirement should contact the Office of Personnel Management, Court Ordered Benefits Branch, P.O. Box 17, Washington, DC 20044-0017, phone (888) 767-6738 or (724) 794-2005 and ask to be transferred to that branch.
To avoid a potential break in coverage, former spouses might want to apply for temporary continuation of FEHB coverage pending a decision on their eligibility for ongoing coverage as a former spouse. Under the temporary continuation of coverage rules, individuals must pay the full cost of the FEHB premiums, plus a 2 percent administrative fee.
Former spouses who do not meet the criteria for ongoing FEHB coverage may continue temporary coverage for three years from the date the marriage ended. To be eligible for temporary continuation, they need only have been covered by FEHB at some time during the 18 months before the marriage dissolved. The application must be filed within 60 days after the divorce or annulment. They are eligible to convert to a non-group health benefits contract when their temporary continuation of coverage ends.
A former spouse who meets the requirements for ongoing FEHB coverage may elect self-only or family insurance. A family enrollment covers only the former spouse and the natural or adopted dependent children of both of the former marriage partners. A child must be under age 26 or incapable of self-support because of a mental or physical disability existing before age 26. A child cannot be covered by more than one FEHB enrollment.
A former spouse’s entitlement to FEHB coverage, if based on entitlement to survivor benefits, normally continues for life. However, a former spouse’s FEHB enrollment may end, subject to a 31-day coverage extension for conversion to an individual contract, when any of the following occur:
• a court order ceases to provide entitlement to a survivor annuity or to a portion of a retirement annuity;
• the former spouse remarries before age 55;
• the employee or annuitant on whose service the benefits are based dies and no survivor annuity is payable to the former spouse;
• a separated employee on whose service the benefits are based dies before the requirements for a deferred annuity have been met;
• an employee on whose service benefits are based leaves federal service before establishing title to an immediate or deferred annuity; or
• a refund of retirement contributions is paid to the separated employee on whose service the benefits are based.
If any of those events occur before the three-year eligibility for temporary continuation of coverage expires, the former spouse can change to temporary continuation enrollment for the remainder of that period.
The coverage of a former spouse’s family member ends, subject to a 31-day extension of coverage for conversion to an individual contract, when the individual ceases to be an eligible family member (as defined above) or when the former spouse ceases to be enrolled, unless the family member is entitled as a survivor annuitant to continued enrollment or is entitled to continued coverage under the enrollment of another person.
A former spouse may cancel enrollment at any time. However, former spouses who cancel their enrollment may not later re-enroll. A former spouse whose enrollment is terminated because of nonpayment of premiums generally may not re-enroll.
Further information is at www.opm.gov/faqs (search for “divorce”).
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Impact on Life Insurance Coverage
General Rules and Procedures
The Office of Federal Employees’ Group Life Insurance (OFEGLI) must pay benefits in accordance with the terms of a valid court decree of divorce, annulment, or legal separation, or the terms of a court order or court-approved property settlement agreement relating to such a court decree, regardless of whether the insured individual actually completes a designation complying with the court order.
To be valid, the court order must be a certified copy. The appropriate office must receive the certified copy before the insured’s death and it must expressly provide for someone to receive your FEGLI benefits.
If a valid court order is in effect, the insured individual cannot change his/her designation of beneficiary, unless the person(s) named in the court order agrees in writing or unless the court order is later modified.
If you are an employee, you must file the court order with your human resources office. If you receive benefits from the Department of Labor, Office of Workers Compensation Programs and you’ve been receiving these benefits for less than 12 months and you are still on the agency’s rolls as an employee, you also must file the order with your agency’s human resources office. If you are a retired employee, or you are on compensation and are separated from your agency or have been receiving compensation for 12 months or more, you must file the order with the Office of Personnel Management, Retirement Operations Center, P.O. Box 45, Validation Section, Boyers, PA 16017-0045.
The date of the court order itself is not relevant. But the date the agency or retirement system (as applicable) received the court order is relevant. If someone submitted a court order before July 22, 1998, it is not valid and OFEGLI cannot honor it. In that situation, a new court order is not necessary; the old one can be resubmitted, and as long as it is a certified copy and you submit it to the appropriate office before the insured dies, it should be acceptable.
You can submit a court order if you are an employee, an annuitant, a former spouse, the former spouse’s attorney or anyone else. You as the insured can cancel coverage even if there is a court order on file. You cannot submit a new designation of beneficiary to void the court order. If there is a valid court order on file, you may not change or submit a designation of beneficiary unless the person(s) named in the decree, order, or agreement agrees in writing or unless the decree, order or agreement is modified.
If valid, a court order can serve as a designation of beneficiary for life insurance purposes even if the insured individual doesn’t complete a designation form.
A court order cannot serve as an assignment of FEGLI benefits. The order can direct that the insured individual assign coverage but unless and until the insured individual files a valid assignment form (RI 76-10 Assignment), the insurance is not assigned. This is different than a designation.
Note: A 2013 U.S. Supreme Court decision, Hillman v. Maretta, No. 11-1221, held that a designation of beneficiary made under FEGLI overrides any state law provision that would cause the proceeds to be paid out in a different manner. In particular, that decision refused to honor a state law designed to provide life insurance benefits to a surviving spouse where the enrollee remarried after a divorce and did not change a designation in favor of the prior spouse.
To avoid a situation in which a divorced FEGLI policyholder could circumvent a court award by changing the designated beneficiary or even canceling the coverage at a later date, many courts will issue an order requiring an assignment of FEGLI coverage to a former spouse or children.
An assignment of benefits transfers ownership of FEGLI coverage to the assignee. The individual who makes the assignment no longer has control over the insurance coverage and can no longer designate beneficiaries. Assignments are irrevocable, and apply to three types of FEGLI coverage: Basic, Option A (standard option) and Option B (additional optional) insurance. Assignment may not be used for Option C (family optional) insurance coverage.
The policyholder, not the employing agency or OPM, is responsible for executing the assignment. This is accomplished by filling out Form RI 76-10, available at www.opm.gov/forms, at most agency personnel offices, and by writing to: Office of Personnel Management, Retirement Operations Center, Attention: RI 76-10, Boyers, PA 16017. OPM does not have authority to enforce a court order directing the assignment of FEGLI coverage. It is the responsibility of the court-designated assignee to ensure that the policyholder has complied with a FEGLI assignment order.
If a FEGLI assignment order is issued, policyholders who own more than one type of coverage must assign all of the insurance (except for family optional), not just part. An assigning policyholder may not name contingent assignees in the event the primary assignee dies first. If the assignment of the insurance is to two or more persons, the individual must specify percentage shares, rather than dollar amounts or types of insurance, to go to each assignee.
Policyholders who assign benefits continue to be insured under the FEGLI program. Premiums will continue to be withheld from their salary, annuity, or compensation payments. However, they may not cancel their life insurance coverage or revoke the assignment.
A determination as to whether the FEGLI proceeds should be included in the insured’s gross estate is made by the IRS at the time of the insured’s death. Individuals should refer to tax laws and IRS regulations in attempting to determine the tax consequences of a FEGLI assignment and may wish to obtain a ruling from the IRS.
The insured person retains the right to elect new insurance coverage, though all new insurance coverage (except for family optional insurance) would be subject to an existing assignment. The assignor also retains the right to decide, at the time of retirement or upon the receipt of workers’ compensation benefits, to maintain more than the minimum percentage of his or her basic life insurance. However, the right to choose a Living Benefit is lost.
The assignment voids all prior beneficiary designations and prohibits the insured person from making any future designations of beneficiaries. Once FEGLI insurance is assigned, the assignee becomes the beneficiary unless he or she designates someone else. The assignee may not elect a Living Benefit.
In addition to designating beneficiaries, an assignee may convert the insurance to an individual policy if the insured person’s eligibility for group insurance ends (e.g., the insured leaves government employment). Assignees also may cancel the insurance or reduce the amount of coverage. When insurance is assigned to more than one person, all must convert their shares to an individual policy when eligibility for group insurance ceases. Similarly, all must consent to a coverage cancellation or reduction.
Each assignee (and beneficiary of an assignee) is responsible for keeping the insured’s employing office informed of his or her current address. The employing office will notify assignees of their conversion rights in the event group insurance coverage ends.
The value of assigned insurance increases or decreases in accordance with any automatic increases or decreases in the value of the coverage.
An assignment is effective on the date the insured’s employing office receives a completed, signed, and witnessed assignment. For retirees, this information should be sent to the Office of Personnel Management, Retirement Operations Center, P.O. Box 45, Boyers, PA 16017-0045.
An assignment of benefits should not be confused with a designation of beneficiary. If there has been no assignment of benefits, a divorce does not affect a previously filed designation of beneficiary. An employee or retiree who has designated a former spouse to receive life insurance benefits must file new designations for any benefits that become payable to go to someone else. Beneficiary designations do not convey any policy-ownership rights under FEGLI and may be changed at any time unless there was an assignment of benefits.
The FEGLI designation of beneficiary form is Standard Form 2823, available at www.opm.gov/forms, as well as at personnel offices for employees or by calling (888) 767-6738 for retirees.
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Impact on Thrift Savings Plan Accounts
A TSP account can be divided by a court decree of divorce, annulment, or legal separation, or a court order or court-approved property settlement agreement incident to such a decree. A court order may be issued at any stage of a divorce, annulment, or legal separation proceeding. The TSP calls such a document a “retirement benefits court order” (court order).
A TSP account also can be garnisheed with a writ, order, summons, or other similar document in the nature of a garnishment that is brought to enforce a participant’s child support or alimony obligation. The TSP calls such a document a “legal process.”
The TSP will review only a complete copy of a court order or legal process. To be complete, a court order must contain all pages and attachments. It also must provide (or be accompanied by a document that provides):
• the participant’s Social Security number;
• the name and address of each payee;
• if the current or former spouse of the participant is a payee, the SSN of the spouse-payee (if it requires the payment to be mailed in care of a third party, it must also provide the state of legal residence of the spouse-payee); and
• if it is written in a language other than English, a certified English language translation of the entire court order.
A qualifying retirement benefits court order or a legal process for the TSP must meet these requirements:
• It must be issued by a court in any of the 50 United States, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Northern Mariana Islands, or the Virgin Islands, or by any Indian court.
• It must expressly relate to the TSP. This means that it must specifically contain the name “Thrift Savings Plan.” Terms such as “all retirement benefits,” “government benefits,” “federal retirement benefits,” “thrift savings,” or “thrift savings account” are not adequate.
• If it requires a payment from a TSP account, it must clearly describe the payee’s entitlement. For example, it can award a specified dollar amount or a fraction or a percentage of the participant’s account as of a specific past or current date. If the court order describes the payee’s entitlement by using a formula, all of the variables in the formula must be included in the court order or be available from TSP records.
• It can require a payment only to the participant’s current or former spouse or to the participant’s dependents. The TSP will not honor a court order asking for a single payment to be made jointly (for example, $10,000 to be divided among the former spouse and dependents). The court order must separately specify the amount of the award made to each person.
Account information requests relating to the TSP must be submitted to the TSP Service Office, P.O. Box 385021, Birmingham, AL 35238, phone from the United States and Canada toll-free (877) 968-3778, TDD (877) 847-4385; other callers (404) 233-4400.
To assist a spouse in developing a valid court order, the TSP will provide the spouse (and the spouse’s attorney), upon written request, with TSP account information such as the participant’s (or beneficiary participant’s) account balance; the outstanding loan balance, if any; and annual or quarterly statements. A subpoena is not required. The TSP will not provide personal information such as a residential address.
Requests must be made in writing to the TSP Legal Processing Unit, P.O. Box 4390, Fairfax, VA 22038-4390; fax (703) 592-0151; overnight delivery: TSP Legal Processing Unit, 12210 Fairfax Town Center, Unit 906, Fairfax, VA 22033. Requests should provide the participant’s (or beneficiary participant’s) name and TSP account number (or Social Security number); identify the individual requesting the information and describe his or her relationship to the participant; describe the information needed; and state the purpose for which the information is being requested.
Court orders and legal processes also should be submitted to the Legal Processing Unit. Since the TSP maintains separate accounts for civilian, uniformed services, and beneficiary participants, if a participant has more than one type of TSP account, court orders and legal processes must identify each account separately. The terms “civilian,” “uniformed services,” and/or “beneficiary participant” must be used.
Divorce, Separation, or Annulment Decrees
A court order can be used to prevent a participant from withdrawing his or her TSP account during a divorce action. As soon as practicable after receiving a court order that is issued in an action for divorce, annulment, or legal separation, the TSP will “freeze” a participant’s account if:
• the court order names the TSP and provides that the participant may not obtain a TSP loan or withdrawal; or
• the court order purports to divide a participant’s TSP account.
Once an account is frozen, no new loans or withdrawals are permitted from the account until the action is resolved. All other account activity will be permitted, including investment decisions and payments on existing loans.
The freeze will be removed from the participant’s TSP account as follows:
• If the account was frozen upon receipt of an incomplete court order, the freeze will be removed if a complete copy of the order is not received within 30 days of the TSP’s written request for a complete copy.
• If the account was frozen in response to a court order issued to preserve the status quo, the freeze will be removed when the TSP receives a court order that removes the freeze, or when the TSP receives a court order that purports to require a payment from the TSP.
• If the account was frozen in response to an order that purports to require a payment from the TSP, or in response to a freeze order, the freeze will be removed as follows:
-If the court order requires a payment from the TSP, the freeze will be removed after the payment is made.
-If the court order is not qualifying, the account will remain frozen for 45 days from the date on which the TSP informs the parties in writing that the order does not qualify. The freeze will be removed sooner if the TSP receives a written agreement—signed by both of the parties involved in the divorce proceeding—that it may be removed.
Child Support or Alimony Decrees
A legal process to enforce a participant’s child support or alimony obligation must be complete and must meet legal requirements paralleling those described above for divorce, separation or annulment decrees.
A participant who is liable for alimony or child support can be prevented from withdrawing his or her TSP account. The participant’s account will be frozen as soon as practicable after the TSP receives a legal process that:
• expressly names the TSP; and
• either requires a payment from the TSP to satisfy a child support or alimony debt or requires the TSP to withhold a portion of the participant’s account in anticipation of an order to make such a payment.
If the participant’s account was frozen upon the TSP’s receipt of a complete document purporting to be a qualifying legal process:
• If the legal process requires a payment from the TSP, the freeze will be removed after the payment is made.
• If the legal process does not qualify to require a payment from the TSP, the freeze will be removed as soon as practicable after the TSP informs the parties in writing that the document is not a qualifying legal process.
Some states allow a two-step garnishment process. The first step consists of an order to withhold, which freezes the debtor’s assets. The second step consists of an order to deliver, which requires the recipient to pay a specified amount of the debtor’s assets to a third party.
If the account was frozen upon receipt of an order to withhold, the freeze will be removed:
• upon receipt of an order removing the freeze;
• after payment pursuant to a qualifying order to deliver; or
• after the TSP informs the parties in writing that an order to deliver does not require a payment from the TSP.
The TSP and the Health and Human Services Department’s Office of Child Support Enforcement share data to facilitate collection from TSP accounts of delinquent child support payments.
Calculating the Amount of Entitlement
Court Order—If a court order awards a percentage or fraction of a TSP account as of a specific day, the payee’s entitlement is determined based on that day’s account balance. If a court order awards a percentage or fraction of a TSP account and does not specify a date for calculating the award, the payee’s entitlement is determined based on the effective date of the order. If a court order awards a fixed dollar amount, the payee’s entitlement is that dollar amount.
If a court order describes a payee’s entitlement as a fixed dollar amount and as a percentage or fraction of the account, the payee’s entitlement is the specified dollar amount, even if the percentage or fraction, when applied against the account balance, yields a different result.
A court order cannot require the TSP to pay more than the participant’s vested account balance. Therefore, if the payee’s entitlement exceeds the participant’s vested account balance when the TSP pays the award, the TSP will only pay the vested account balance.
Legal Process—Because a legal process can only award a specific dollar amount, the payee’s entitlement is determined based on the participant’s vested account balance at the time of payment.
The tax treatment of a payment made under a qualifying court order or legal process depends on the type of money invested into the TSP account. A TSP account may consist of a traditional balance, a Roth balance, or both. See Chapter 6, Section 1.
If a payment is made to the current or former spouse of the participant, the taxable portion of the payment is reported to the Internal Revenue Service as gross income for the recipient spouse for the tax year in which the payment is made, unless the funds are transferred as described below. This is the case even if the payment is intended to satisfy child or spousal support arrears.
If the payment is made to someone other than the current or former spouse of the participant (for example, a support enforcement agency), the taxable portion of the payment is reported to the IRS as gross income for the participant for the tax year in which the payment is made.
A payment in response to a retirement benefits court order or legal process is not subject to an early withdrawal penalty tax.
All or part of a payment to a current or former spouse under a court order or legal process may be transferred to a traditional IRA, a Roth IRA, or an eligible employer plan (note: this option does not apply to court-ordered payments made from beneficiary participant accounts). Current or former spouses asking the TSP to make such a transfer must use the TSP forms provided with the TSP decision letter; the TSP will not accept transfer forms developed by financial institutions. The financial institution to which the payment is being transferred must complete the relevant section of the appropriate TSP form. The TSP will not honor payment information, financial institution information, or payment elections submitted in the form of a cover letter or embedded within a court order document.
The TSP tax notice Tax Treatment of Thrift Savings Plan Payments Made Under Qualifying Orders is available at https://www.tsp.gov/forms/legalDocuments.shtml, from agency personnel offices, and from the TSP Service Office (see General, above, for contact information).
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Garnishment for Child Support or Alimony
General Rules and Procedures
To enforce alimony and child support obligations, the salaries of federal and postal employees, as well as retirees’ annuity payments and Social Security benefits, are subject to garnishment, under Section 659 of Title 42, United States Code. Similarly, their pay or annuity is subject to withholding under state law and under any other legal process brought by a state agency administering a program to enforce an individual’s legal obligations to provide child support and alimony. (Separate rules apply to child support and alimony orders affecting the TSP; see preceding section.)
While the federal provisions do not pre-empt state or local law regarding the bringing of civil actions to enforce support and maintenance obligations, Congress has set maximum limitations on the percentage of wage or benefit payments that may be subject to garnishment.
Legal orders that the government will honor include any writ, order, summons, notice to withhold income, or similar garnishment process. This includes attachments, a writ of execution, court-ordered wage assignments, or orders by a child support agency. Enforceable orders include those issued by a court (or court official) of competent jurisdiction or a state agency authorized to issue income-withholding notices under state or local law.
OPM is authorized to comply with the terms of a court decree, order, or property settlement in connection with the divorce or legal separation of an individual who is eligible for benefits under the CSRS, under Section 8345(j) of Title 5, U.S. Code. Civil service retirement benefits must be specifically divided by divorce decree or court order to qualify for payment under this law. Former spouses of federal employees or annuitants may be entitled to receive all or a portion of the spousal survivor annuity or lump-sum refund that may become payable based upon the employee’s or annuitant’s service, under Sections 8339(j), 8341(h), and 8342(j) of Title 5.
With only limited exceptions, these rights apply only to former spouses who were still married on or after May 7, 1985, to an employee or annuitant who retired, died, or took a lump-sum refund on or after that date. The statutes permit such a division of the survivor annuity to be made, subject to restrictions, by agreement between the employee and the former spouse at the time of retirement or within two years thereafter, or a division of the annuity or lump-sum benefit pursuant to a court order or court-approved property settlement incident to a decree of divorce or annulment. A court order or court-approved settlement pursuant to a decree of legal separation may divide the lump-sum benefit, but not the annuity.
Similar provisions establishing entitlement rights for certain former spouses to all or a portion of spousal survivor annuity benefits or lump-sum refunds payable under the FERS are contained in Sections 8417, 8445 and 8424(b) of Title 5. These provisions of the FERS system, enacted by Public Law 99-335, were effective January 1, 1987.
For the types of compensation subject to garnishment and for certain other restrictions on garnishment actions, see Garnishment in Chapter 1, Section 4.
Maximum Garnishment Amounts
Public Law 95-30 established the following general limitations on amounts that can be garnisheed to enforce a support obligation. Unless state or local law provides a lower maximum garnishment limitation, the maximum amounts subject to garnishment are:
• Fifty percent of the obligor’s aggregate disposable earnings for any workweek, where the obligor asserts by affidavit or other acceptable evidence that he or she is supporting a spouse, a dependent child (or both), other than the former spouse and/or child for whose support the order is issued. The amount may increase to 55 percent if the garnishment is to enforce a support order for a period that is 12 weeks prior to that workweek. An obligor is considered to be supporting a spouse, dependent child, or both, when providing more than half of their support.
• Sixty percent of the obligor’s aggregate disposable earnings for any workweek, where the obligor fails to assert by affidavit or otherwise establish that he or she is supporting a spouse, dependent child, or both, other than a former spouse, child, or both, for whose support the order is issued. The amount may increase to 65 percent if the garnishment is to enforce a support order for a period that is 12 weeks prior to that workweek.
Where obligors submit evidence that they are supporting a second spouse, child, or both, copies of this evidence will be sent by the governmental entity to the garnishor or the garnishor’s representative, as well as to the court or other authority together with notification that the obligor’s support claim will be honored. Garnishors who disagree with an obligor’s support claim should refer the matter to the court or other authority for resolution.
The garnishment order or similar legal process should state on its face that it is to enforce an obligation to provide child support or to make alimony payments. The legal notice must include the garnishee’s name, date of birth, Social Security or retirement claim number, employment status, and the employing component and official duty station. If the information submitted is deemed insufficient, the legal order will be returned to the issuer with an explanation of the deficiency.
For active employees, a legal notice of garnishment or similar support order must be served on the appropriate agency office designated to receive such orders or, if none has been designated, on the agency head (offices designated to accept garnishment orders are listed in 5 CFR 581.501). If the notice is not directed to any particular official within the entity or if it is addressed to the wrong individual, the recipient must forward the legal process to the designated agent. However, valid service is not accomplished until the notice is received in the office of the designated agent. The government is not liable for any costs or damages resulting from an agency’s failure to timely serve process or to correct faulty service of process.
For retirees, the garnishment order should be sent by certified or registered mail, return receipt requested, to the Office of Personnel Management’s Court Ordered Benefits Branch, P.O. Box 17, Washington, DC 20044-0017, phone (888) 767-6738 and ask to be transferred to that branch.
When a valid order is received, the government will notify the obligor that legal process has been served. The notice will describe the maximum garnishment limitations, request evidence needed to determine the applicable limitation, and inform the obligor of the amount that will be withheld if he or she fails to submit such evidence.
The government will comply with valid legal orders unless they would require withholding of funds not eligible for garnishment. Where notice is received that the obligor has appealed either the legal process or the justification for the underlying alimony or child support order, payment of money subject to the legal process will be suspended unless the law of the jurisdiction prohibits it. The money will continue to be withheld and will be retained by the government until an order is received to resume payments or otherwise disburse the suspended amounts. Payments will not be suspended if the law of the jurisdiction where the appeal was filed requires compliance while an appeal is pending.
The government will not vary its normal pay or disbursement cycles to comply with a garnishment order.
The government will comply with an order that requires withholding for the payment of attorney fees, interest or other costs, as long as it expressly provides for those payments and the award is within the authority of the court, official, or agency issuing the order.
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The provisions of law that govern CSRS benefits are in Sections 8341, 8342, 8345, and 8346, of Title 5 of the U.S. Code. The law governing FERS benefits is in Sections 8401, 8424, 8445, 8467, and 8470 of Title 5. The regulations covering both CSRS and FERS benefits are in Part 838 of Title 5, Code of Federal Regulations.
The law on continuing FEHB coverage for former spouses is in Sections 8901 and 8905 of Title 5 of the United States Code. Regulations are in subpart H of Part 890 of Title 5 of the Code of Federal Regulations.
Assignments of FEGLI coverage are authorized by Section 8706 of Title 5, United States Code. Regulations are in subpart I of Part 870 of Title 5 of the Code of Federal Regulations.
The OPM Handbook for Attorneys on Court Ordered Retirement, Health Benefits, and Life Insurance is at http://archive.opm.gov/retire/pubs/pamphlets/ri83-116.pdf.
The Thrift Savings Plan’s policies governing court orders are at 5 U.S.C. 8435(c) and 8467, and 5 CFR 1653, subpart A. Policies governing legal processes are at 5 U.S.C. 8437(e)(3) and 5 CFR 1653, subpart B. The booklet Court Orders and Powers of Attorney contains a sample legal process and other information, and the legal document Court Order Language contains a sample retirement benefits court order. These are available at https://www.tsp.gov/forms/legalDocuments.shtml, through personnel offices and through the TSP Service Office, P.O. Box 385021, Birmingham, AL 35238, phone from the United States and Canada toll-free (877) 968-3778, TDD (877) 847-4385; other callers (404) 233-4400.