5 U.S.C. § 8345 — Payment of benefits; commencement, termination, and waiver of annuity

submitted 60 years ago by Pub. L. 89-554 to r/title-5-GOVERNMENT-ORGANIZATION-AND-EMPLOYEES · 1,497 words · no verdicts yet

in plain englishAI-generated · not legal advice

This law sets the rules for paying out federal retirement annuities. It covers when payments start and stop, how they're protected for minors, and when they can go to another person, like a former spouse. It also lets states withhold state income tax from an annuitant's payments.

(a) An annuity is set as a yearly amount. One-twelfth of it, rounded down to the nearest dollar, is paid monthly on the first business day after the period it covers. (b) Normally, an employee's or Member's annuity starts the first day of the month after they separate from service, or after their pay stops and they meet the service and age requirements. Any other Fund annuity starts the first day of the month after the event that triggers it. But an annuity starts one day sooner — the day right after separation or after pay stops — for someone involuntarily separated (other than being fired for cause), or for an employee or Member retiring due to disability under section 8337. (c) A retired employee's or Member's own annuity ends on the day they die or some other ending event happens. A survivor's annuity ends on the last day of the month before death or the ending event. (d) Anyone entitled to an annuity can decline all or part of it by signing and filing a waiver with OPM. They can revoke that waiver in writing at any time, but they cannot get back-paid for the period the waiver was in effect. (e) Payment due to a minor, or to someone mentally incompetent or otherwise legally unable to manage their affairs, can go to whoever is their legal guardian under state law, or, if there is no guardian, to any person or organization OPM judges responsible for that person's care — and paying that person blocks anyone else's claim. If OPM decides paying the person directly would cause them serious harm, OPM can delay payment until a proper guardian is appointed, but must then pay everything owed as soon as possible. (f) OPM cannot let someone receive payments on behalf of a minor or legally incapacitated person if that person has been convicted of violating the fraud rules in section 8345a or 8466a, certain Social Security Act provisions, or section 6101 of title 38. (g) OPM must write regulations reducing certain monthly annuities — ones computed using pre-1969 service under section 8332(b)(6) — by whatever portion of a state retirement benefit the person is (or would be) entitled to for that same service. (h) An annuitant can arrange allotments or assignments out of their annuity, for whatever purposes OPM, at its discretion, considers appropriate. (i) No payment can be made from the Fund unless the application is received before the person's 115th birthday. After someone's death, no benefit based on their service can be paid unless the application is received within 30 years of the death or other triggering event. (j) Payments that would normally go to an employee, Member, or annuitant must instead be paid, in whole or part, to someone else, if a court decree of divorce, annulment, or legal separation (or a related court order or settlement) requires it, or if a court order or similar legal process is enforcing a judgment against that person for physically, sexually, or emotionally abusing a child. If OPM gets more than one such order for the same money, it pays them in the order it received them, first-come first-served. This rule only applies to payments made after OPM gets proper written notice and documentation. "Court" here includes state, D.C., Puerto Rico, Guam, Northern Mariana Islands, Virgin Islands, and tribal courts; "judgment... for abusing a child" means a final court judgment based even partly on that abuse; "child" means anyone under 18. (k) OPM must sign an agreement with any state within 120 days of that state's request, to withhold state income tax from any annuitant who asks for it in writing. The withheld money sits in the Fund and gets sent to the states quarterly. An annuitant can only have one withholding request active at a time, and no more than two per calendar year. They can change which state gets the withholding, or cancel it, but the change or cancellation only takes effect on the first of the month after it's processed (no later than the first of the second month after OPM receives it). This does not force the federal government to follow state rules that are more burdensome than what applies to regular employers, or to face state penalties over this. OPM cannot accept payment from a state for doing this withholding, and any amount mistakenly withheld and sent to a state must be repaid by that state under OPM's regulations. "State" here means a state, D.C., or any U.S. territory or possession. (l) A transfer of contributions and deposits authorized under the Foreign Service Act of 1980 counts as full, final payment of benefits under this chapter.

the actual law source: uscode.house.gov ↗public domain

(a)

Each annuity is stated as an annual amount, one-twelfth of which, rounded to the next lowest dollar, constitutes the monthly rate payable on the first business day of the month after the month or other period for which it has accrued.

(b)

(1)

Except as otherwise provided—

(A)

an annuity of an employee or Member commences on the first day of the month after—

(i)

separation from the service; or

(ii)

pay ceases and the service and age requirements for title to annuity are met; and

(B)

any other annuity payable from the Fund commences on the first day of the month after the occurrence of the event on which payment thereof is based.

(2)

The annuity of—

(A)

an employee involuntarily separated from service, except by removal for cause on charges of misconduct or delinquency; and

(B)

an employee or Member retiring under section 8337 of this title due to a disability;

shall commence on the day after separation from the service or the day after pay ceases and the service and age or disability requirements for title to annuity are met.

(c)

The annuity of a retired employee or Member terminates on the day death or other terminating event provided by this subchapter occurs. The annuity of a survivor terminates on the last day of the month before death or other terminating event occurs.

(d)

An individual entitled to annuity from the Fund may decline to accept all or any part of the annuity by a waiver signed and filed with the Office of Personnel Management. The waiver may be revoked in writing at any time. Payment of the annuity waived may not be made for the period during which the waiver was in effect.

(e)

(1)

Payment due a minor, or an individual mentally incompetent or under other legal disability, may be made to the person (including an organization) who is constituted guardian or other fiduciary by the law of the State of residence of the claimant or is otherwise legally vested with the care of the claimant or his estate. If a guardian or other fiduciary of the individual under legal disability has not been appointed under the law of the State of residence of the claimant, payment may be made to any person (including an organization) who, in the judgment of the Office, is responsible for the care of the claimant and may appropriately receive such payments on behalf of the claimant, and the payment bars recovery by any other person.

(2)

If the Office determines that direct payment of a benefit to an individual mentally incompetent or under other legal disability would cause substantial harm to the individual, the Office may defer or suspend direct payment of the benefit until such time as the appointment of a representative payee is made. The Office shall resume payment as soon as practicable, including all amounts due.

(f)

The Office may not authorize a person to receive payments on behalf of a minor or individual of legal disability under subsection (e) if that person has been convicted of a violation of—

(1)

section 8345a or 8466a;

(2)

section 208 or 1632 of the Social Security Act (42 U.S.C. 408, 1383a); or

(3)

section 6101 of title 38.

(g)

The Office shall prescribe regulations to provide that the amount of any monthly annuity payable under this section accruing for any month and which is computed with regard to service that includes any service referred to in section 8332(b)(6) performed by an individual prior to January 1, 1969, shall be reduced by the portion of any benefits under any State retirement system to which such individual is entitled (or on proper application would be entitled) for such month which is attributable to such service performed by such individual before such date.

(h)

An individual entitled to an annuity from the Fund may make allotments or assignments of amounts from his annuity for such purposes as the Office of Personnel Management in its sole discretion considers appropriate.

(i)

(1)

No payment shall be made from the Fund unless an application for benefits based on the service of an employee or Member is received in the Office of Personnel Management before the one hundred and fifteenth anniversary of his birth.

(2)

Notwithstanding paragraph (1) of this subsection, after the death of an employee, Member, or annuitant, no benefit based on his service shall be paid from the Fund unless an application therefor is received in the Office of Personnel Management within 30 years after the death or other event which gives rise to title to the benefit.

(j)

(1)

Payments under this subchapter which would otherwise be made to an employee, Member, or annuitant based on service of that individual shall be paid (in whole or in part) by the Office to another person if and to the extent expressly provided for in the terms of—

(A)

any court decree of divorce, annulment, or legal separation, or the terms of any court order or court-approved property settlement agreement incident to any court decree of divorce, annulment, or legal separation; or

(B)

any court order or other similar process in the nature of garnishment for the enforcement of a judgment rendered against such employee, Member, or annuitant, for physically, sexually, or emotionally abusing a child.

In the event that the Office is served with more than 1 decree, order, or other legal process with respect to the same moneys due or payable to any individual, such moneys shall be available to satisfy such processes on a first-come, first-served basis, with any such process being satisfied out of such moneys as remain after the satisfaction of all such processes which have been previously served.

(2)

Paragraph (1) shall only apply to payments made by the Office under this subchapter after the date of receipt in the Office of written notice of such decree, order, other legal process, or agreement, and such additional information and documentation as the Office may prescribe.

(3)

For the purpose of this subsection—

(A)

the term “court” means any court of any State, the District of Columbia, the Commonwealth of Puerto Rico, Guam, the Northern Mariana Islands, or the Virgin Islands, and any Indian court;

(B)

the term “judgment rendered for physically, sexually, or emotionally abusing a child” means any legal claim perfected through a final enforceable judgment, which claim is based in whole or in part upon the physical, sexual, or emotional abuse of a child, whether or not that abuse is accompanied by other actionable wrongdoing, such as sexual exploitation or gross negligence; and

(C)

the term “child” means an individual under 18 years of age.

(k)

(1)

The Office shall, in accordance with this subsection, enter into an agreement with any State within 120 days of a request for agreement from the proper State official. The agreement shall provide that the Office shall withhold State income tax in the case of the monthly annuity of any annuitant who voluntarily requests, in writing, such withholding. The amounts withheld during any calendar quarter shall be held in the Fund and disbursed to the States during the month following that calendar quarter.

(2)

An annuitant may have in effect at any time only one request for withholding under this subsection, and an annuitant may not have more than two such requests in effect during any one calendar year.

(3)

Subject to paragraph (2) of this subsection, an annuitant may change the State designated by that annuitant for purposes of having withholdings made, and may request that the withholdings be remitted in accordance with such change. An annuitant also may revoke any request of that annuitant for withholding. Any change in the State designated or revocation is effective on the first day of the month after the month in which the request or the revocation is processed by the Office, but in no event later than on the first day of the second month beginning after the day on which such request or revocation is received by the Office.

(4)

This subsection does not give the consent of the United States to the application of a statute which imposes more burdensome requirements on the United States than on employers generally, or which subjects the United States or any annuitant to a penalty or liability because of this subsection. The Office may not accept pay from a State for services performed in withholding State income taxes from annuities. Any amount erroneously withheld from an annuity and paid to a State by the Office shall be repaid by the State in accordance with regulations issued by the Office.

(5)

For the purpose of this subsection, “State” means a State, the District of Columbia, or any territory or possession of the United States.

(l)

Transfers of contributions and deposits authorized by section 408(a)(3) of the Foreign Service Act of 1980 shall be deemed to be a complete and final payment of benefits under this chapter.

Source credit: (Pub. L. 89–554, Sept. 6, 1966, 80 Stat. 582; Pub. L. 93–273, § 1, Apr. 26, 1974, 88 Stat. 93; Pub. L. 94–126, § 1(c), Nov. 12, 1975, 89 Stat. 679; Pub. L. 94–166, § 1, Dec. 23, 1975, 89 Stat. 1002; Pub. L. 94–183, § 1, Dec. 31, 1975, 89 Stat. 1057; Pub. L. 95–366, § 1(a), Sept. 15, 1978, 92 Stat. 600; Pub. L. 95–454, title IX, § 906(a)(2), (3), Oct. 13, 1978, 92 Stat. 1224; Pub. L. 97–35, title XVII, § 1705(a), Aug. 13, 1981, 95 Stat. 758; Pub. L. 97–253, title III, §§ 304(b), 305(a), Sept. 8, 1982, 96 Stat. 795; Pub. L. 98–615, § 2(6), Nov. 8, 1984, 98 Stat. 3202; Pub. L. 99–251, title III, § 305(a), Feb. 27, 1986, 100 Stat. 26; Pub. L. 101–246, title I, § 141(b), Feb. 16, 1990, 104 Stat. 35; Pub. L. 103–358, § 2(a), Oct. 14, 1994, 108 Stat. 3420; Pub. L. 116–126, § 2(c)(1), (d)(1), Mar. 18, 2020, 134 Stat. 175, 176.)

history & why it existsrecord from the source credit

1966Enacted · Pub. L. 89-554 · 80 Stat. 582
1974Amended · Pub. L. 93-273 · 88 Stat. 93
1975Amended · Pub. L. 94-126 · 89 Stat. 679
1975Amended · Pub. L. 94-166 · 89 Stat. 1002
1975Amended · Pub. L. 94-183 · 89 Stat. 1057
1978Amended · Pub. L. 95-366 · 92 Stat. 600
1978Amended · Pub. L. 95-454 · 92 Stat. 1224
1981Amended · Pub. L. 97-35 · 95 Stat. 758
1982Amended · Pub. L. 97-253 · 96 Stat. 795
1984Amended · Pub. L. 98-615 · 98 Stat. 3202
1986Amended · Pub. L. 99-251 · 100 Stat. 26
1990Amended · Pub. L. 101-246 · 104 Stat. 35
1994Amended · Pub. L. 103-358 · 108 Stat. 3420
2020Amended · Pub. L. 116-126 · 134 Stat. 175, 176

A history note hasn’t been published yet. The record shows enactment by Pub. L. 89-554 on 1966-09-06.

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