Retirement Benefits for Members of Congress
Katelin P. Isaacs
Analyst in Income Security
August 9, 2013
Congressional Research Service
7-5700
www.crs.gov
RL30631
CRS Report for Congress
Pr
epared for Members and Committees of Congress

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Retirement Benefits for Members of Congress

Summary
Prior to 1984, neither federal civil service employees nor Members of Congress paid Social
Security taxes, nor were they eligible for Social Security benefits. Members of Congress and
other federal employees were instead covered by a separate pension plan called the Civil Service
Retirement System (CSRS). The 1983 amendments to the Social Security Act (P.L. 98-21)
required federal employees first hired after 1983 to participate in Social Security. These
amendments also required all Members of Congress to participate in Social Security as of January
1, 1984, regardless of when they first entered Congress. Because CSRS was not designed to
coordinate with Social Security, Congress directed the development of a new retirement plan for
federal workers. The result was the Federal Employees’ Retirement System Act of 1986 (P.L. 99-
335).
Members of Congress first elected in 1984 or later are covered automatically under the Federal
Employees’ Retirement System (FERS). All Senators and those Representatives serving as
Members prior to September 30, 2003, may decline this coverage. Representatives entering office
on or after September 30, 2003, cannot elect to be excluded from such coverage. Members who
were already in Congress when Social Security coverage went into effect could either remain in
CSRS or change their coverage to FERS. Members are now covered under one of four different
retirement arrangements:
• CSRS and Social Security;
• The “CSRS Offset” plan, which includes both CSRS and Social Security, but
with CSRS contributions and benefits reduced by Social Security contributions
and benefits;
• FERS and Social Security; or
• Social Security alone.
Congressional pensions, like those of other federal employees, are financed through a
combination of employee and employer contributions. All Members pay Social Security payroll
taxes equal to 6.2% of the Social Security taxable wage base ($113,700 in 2013). Members
enrolled in FERS and elected prior to 2013 also pay 1.3% of full salary to the Civil Service
Retirement and Disability Fund (CSRDF). Members of Congress first elected after 2012 and
enrolled in FERS contribute 3.1% of pay to the CSRDF in addition to their Social Security
contributions. In 2013, Members covered by CSRS Offset pay 1.8% of the first $113,700 of
salary, and 8.0% of salary above this amount, into the CSRDF.
Under both CSRS and FERS, Members of Congress are eligible for a pension at the age of 62 if
they have completed at least five years of service. Members are eligible for a pension at age 50 if
they have completed 20 years of service, or at any age after completing 25 years of service. The
amount of the pension depends on years of service and the average of the highest three years of
salary. By law, the starting amount of a Member’s retirement annuity may not exceed 80% of his
or her final salary.
As of October 1, 2012, 527 retired Members of Congress were receiving federal pensions based
fully or in part on their congressional service. Of this number, 312 had retired under CSRS and
were receiving an average annual pension of $71,472. A total of 215 Members had retired with
service under FERS and were receiving an average annual pension of $40,560 in 2012.
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Contents
Background on Congressional Pensions .......................................................................................... 1
Retirement Plans Available to Members of Congress ...................................................................... 2
Members First Elected Before 1984 .......................................................................................... 2
Members First Elected Since 1984 ............................................................................................ 3
Age and Length-of-Service Requirements....................................................................................... 3
Retirement Under CSRS ............................................................................................................ 4
Retirement Under FERS ............................................................................................................ 4
Coordination of FERS Benefits with Social Security................................................................ 5
Social Security Retirement Benefits .......................................................................................... 5
Social Security Earnings Limit .................................................................................................. 6
The Thrift Savings Plan: An Integral Component of FERS ...................................................... 6
Required Contributions to Retirement Programs ............................................................................. 7
Total Payroll Deductions ........................................................................................................... 8
Pension Plan Benefit Formulas ........................................................................................................ 9
Pension Benefits Under CSRS .................................................................................................. 9
Pension Benefits Under FERS ................................................................................................. 10
Social Security Benefits .......................................................................................................... 11
Pensions for Members with Service Under Both CSRS and FERS ............................................... 11
Retirement Benefits Under the CSRS Offset Plan ......................................................................... 12
Replacement Rates ......................................................................................................................... 12
Cost-of-Living Adjustments .................................................................................................... 13
The Thrift Savings Plan ................................................................................................................. 13
Mandatory Coverage Under FERS ................................................................................................ 15
Retirement Benefits for Members with Limited Service ............................................................... 15
Forfeiture of Annuity ..................................................................................................................... 16

Tables
Table 1. Annuity Replacement Rates for Members ....................................................................... 13

Contacts
Author Contact Information........................................................................................................... 17
Acknowledgments ......................................................................................................................... 17

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Background on Congressional Pensions
The Civil Service Retirement Act of 1920 (P.L. 66-215) established a pension system for federal
employees in the executive branch of government. Coverage under the Civil Service Retirement
System (CSRS) was extended to Congress in January 1942 by P.L. 77-411. That law was repealed
just two months later in response to adverse public opinion. In 1946, P.L. 79-601 again extended
CSRS coverage to Congress, at the option of Members, with higher contributions and greater
benefits than those applicable to regular federal employees. In reference to that legislation,
S.Rept. 79-1400 (May 31, 1946) stated that a retirement plan for Congress
would contribute to independence of thought and action, [be] an inducement for retirement
for those of retiring age or with other infirmities, [and] bring into the legislative service a
larger number of younger Members with fresh energy and new viewpoints concerning the
economic, social, and political problems of the Nation.
The Social Security Amendments of 1983 (P.L. 98-21) required all federal employees hired in
1984 or later to participate in Social Security.1 These amendments also required all Members of
Congress to participate in Social Security as of January 1, 1984, regardless of when they first
entered Congress. Requiring federal workers to participate in both CSRS and Social Security
would have duplicated some benefits and would have resulted in employee payroll deductions for
the two programs that would exceed 13% of pay. After mandating Social Security coverage of
new federal employees beginning in 1984, Congress directed the development of a new
retirement plan for federal workers with Social Security coverage as its foundation. The result of
this effort was the Federal Employees’ Retirement System Act of 1986 (P.L. 99-335).
The Federal Employees’ Retirement System (FERS) went into effect in 1987, and employees first
hired in 1984 or later were automatically enrolled in this plan. Employees who had been in the
federal government before 1984 were given the option to remain in CSRS—without Social
Security coverage—or to switch to FERS. The options for Members of Congress differed from
those available to other federal employees because the 1983 amendments required all Members
of Congress to participate in Social Security. Members first elected in 1984 or later were given
the option to enroll in FERS as well as being covered by Social Security, or to be covered only by
Social Security.2 Members who had been in Congress before 1984 could elect to stay in CSRS in
addition to being covered by Social Security; to elect coverage under an “offset plan” that
integrates CSRS and Social Security; to elect coverage under FERS in addition to being covered
by Social Security; or to be covered only by Social Security.3
Because of the uncertain tenure of congressional service, FERS was originally designed, as CSRS
had been, to provide a larger benefit for each year of service to Members of Congress and

1 The Social Security Act became law in 1935 and at that time covered only workers in the private sector.
2 Until enactment of the Legislative Branch Appropriations Act, 2004 (P.L. 108-83), all Members could decline FERS
coverage and choose to be covered by Social Security only. Effective with passage of P.L. 108-83, however,
Representatives entering office on or after September 30, 2003, may not elect to be excluded from such coverage;
although all Senators and those Representatives serving as Members prior to September 30, 2003, continue to be able to
decline this coverage. For more details, see section on “Mandatory Coverage Under FERS.”
3 Under the “Offset Plan,” payroll deductions go partly to Social Security and partly to the Civil Service Retirement and
Disability Fund. In retirement, the individual’s CSRS pension is reduced (“offset”) by the amount of his or her Social
Security benefit.
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congressional staff than to most other federal employees. Prior to P.L. 112-96, all Members of
Congress also became eligible for retirement annuities at an earlier age and with fewer years of
service than most other federal employees. However, all Members of Congress and congressional
staff also paid a higher percentage of salary for their retirement benefits than do most other
federal employees before P.L. 112-96 was enacted.
The Middle Class Tax Relief and Job Creation Act of 2012 (P.L. 112-96) made two significant
changes to the retirement benefits of Members of Congress who are first elected after December
31, 2012.4 First, P.L. 112-96 increased the FERS employee contributions by 1.8% for Members
of Congress first elected (or re-elected with less than five years of FERS service) after December
31, 2012. Therefore, after 2012, newly elected Members are required to contribute 3.1% of pay to
FERS. Second, P.L. 112-96 also decreased the FERS benefit accrual rate (used in the FERS
pension calculation) for Members first elected after December 31, 2012, to be the same as regular
FERS employees.5 Therefore, the larger benefit per year of service under FERS is no longer
available to Members first elected after December 31, 2012 (or congressional employees first
hired after December 31, 2012). In addition, for individuals hired after December 31, 2012, there
will no longer be larger employee contributions under FERS required for Members and
congressional employees in comparison with regular FERS employees; all of these groups
contribute 3.1% of pay toward their FERS annuity. Members of Congress first elected after
December 31, 2012, however, remain eligible for retirement annuities under FERS at earlier ages
and with fewer years of service than most other federal employees.
As of October 1, 2012, 527 retired Members of Congress were receiving federal pensions based
fully or in part on their congressional service. Of this number, 312 had retired under CSRS and
215 had retired under FERS. Members who had retired under CSRS had completed, on average,
21.1 years of civilian federal service.6 Their average annual CSRS annuity in 2012 was $71,472.
Those who had retired under FERS had completed, on average, 15.7 years of civilian federal
service.7 Their average retirement annuity in 2012 (not including Social Security) was $40,560.
The average age of retired Members of Congress receiving retirement annuities in 2012 was 76
for those who had retired under CSRS and 71 for those who had retired under FERS.
Retirement Plans Available to Members of Congress
Members First Elected Before 1984
Members of Congress who were first elected before 1984 may be covered under one of four
retirement plans:
• Dual Coverage. This is full coverage by both CSRS and Social Security.

4 P.L. 112-96 also made changes to FERS employee contributions for regular FERS employees. For information on
these changes, see CRS Report 98-810, Federal Employees’ Retirement System: Benefits and Financing, by Katelin P.
Isaacs.
5 See section on “Pension Benefits Under FERS” below for details.
6 The mean number of years of military service for retired Members of Congress receiving CSRS annuities in 2012 was
1.3.
7 The mean military service for retired Members of Congress receiving FERS annuities in 2012 was 0.9 years.
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• CSRS Offset. This is coverage by CSRS and Social Security, but with CSRS
contributions and benefits reduced (“offset”) by the amount of Social Security
contributions and benefits.
• FERS. This is composed of the FERS basic annuity, Social Security, and the
Thrift Savings Plan (TSP).
• Social Security Only. This occurs if the Member declines other coverage.
Members and other federal employees who were covered under CSRS had the opportunity to
switch to FERS during two six-month “open seasons” in 1987 and 1998. In 1987, fewer than 5%
of eligible federal employees switched from CSRS to FERS, and in 1998 less than 1% of eligible
employees switched.
Members First Elected Since 1984
Members of Congress who were first elected in 1984 or later are covered automatically by the
Federal Employees’ Retirement System. Prior to the Legislative Branch Appropriations Act, 2004
(P.L. 108-83), all Members could decline this coverage. Effective with passage of P.L. 108-83,
however, Representatives entering office on or after September 30, 2003, may not elect to be
excluded from such coverage. All Senators, regardless of date, and those Representatives serving
as Members prior to September 30, 2003, continue to be able to decline this coverage.
FERS is composed of three elements:
• Social Security,
• the FERS basic annuity, a monthly pension based on years of service and the
average of the three highest consecutive years of basic pay,
• the Thrift Savings Plan (TSP), into which participants can deposit up to a
maximum of $17,500 in 2013. Their employing agency matches employee
contributions up to 5% of pay.
Members who enter Congress with at least five years of previous federal employment covered by
CSRS can choose to participate in the CSRS Offset Plan rather than FERS.
Age and Length-of-Service Requirements
Members become vested in (legally entitled to) a pension benefit under CSRS or FERS after five
years of service. The age and service requirements for retirement eligibility are determined by the
plan under which a Member is covered at the time of retirement, regardless of whether he or she
has previous service covered under a different plan.8 Depending on a Member’s age and years of
service, a pension can be taken immediately upon retirement or only on a deferred basis.

8 Active-duty military service can be counted toward retirement eligibility, but not toward five-year vesting. In order
for military service to count toward the amount of one’s retirement annuity, the individual must deposit in the Civil
Service Retirement and Disability Fund the amount that would have been withheld if retirement deductions had been
made during the person’s years of military service, plus accrued interest on this amount.
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Likewise, the Member’s age and years of service, as well as the starting date of the annuity, will
determine whether he or she is eligible for a full pension or a reduced pension.
Retirement Under CSRS
Four retirement scenarios are possible for Members covered by CSRS or the CSRS Offset Plan.
Retirement with an immediate, full pension is available to Members aged 60 or older with
10 years of service in Congress, or aged 62 with five years of civilian federal service,
including service in Congress.
Retirement with an immediate, reduced pension is available to Members aged 55 to 59 with
at least 30 years of service. It is also allowed if the Member separates for a reason other than
resignation or expulsion after having completed 25 years of service, or after reaching the age
of 50 and with 20 years of service, or after having served in nine Congresses.9
Retirement with a deferred, full pension is available if the Member leaves Congress before
reaching the minimum age required to receive an immediate, unreduced pension and delays
receipt until reaching the age at which full benefits are paid. A full pension can be taken at the
age of 62 if the Member had five through nine years of federal service, or at the age of 60 if
the Member had at least 10 years of service in Congress. At the time of separation, the
Member must leave all contributions in the plan to be eligible for the deferred pension.
Retirement with a deferred, reduced pension is available to a Member at the age of 50 if he
or she retired before that age and had at least 20 years of federal service, including at least 10
years as a Member of Congress.
Retirement Under FERS
There are four possible retirement scenarios for Members who are covered by FERS.
Retirement with an immediate, full pension is available to Members aged 62 or older with at
least five years of federal service; aged 50 or older with at least 20 years of service; and at
any age to Members with at least 25 years of service.
Retirement with an immediate, reduced pension is available at the age of 55 to Members
born before 1948 with at least 10 years of service. The minimum age will increase to 56 for
Members born from 1953 through 1964 and to 57 for those born in 1970 or later.
Retirement with a deferred, full pension is available at the age of 62 to former Members of
Congress with at least five years of federal service.
Retirement with a deferred, reduced pension is available at the minimum retirement age of
55 to 57 (depending on year of birth) to a former Member who has completed at least 10

9 The pension is reduced by one-twelfth of 1% for each month not in excess of 60 months, and one-sixth of 1% for each
month in excess of 60 months that the Member is under age 60 at the date of separation. Reasons for separation “other
than resignation or expulsion” include both choosing not to seek re-election and not winning re-election.
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years of federal service. The pension annuity will be permanently reduced if it begins before
the age of 62.10
Coordination of FERS Benefits with Social Security
The FERS basic annuity was designed to supplement Social Security retirement benefits. FERS
retirees under aged 62 who retire with an unreduced pension are eligible for a temporary
supplement to their FERS pension to fill in until Social Security eligibility is reached at the age of
62. The supplement is an amount estimated to equal the Social Security benefits accrued from
federal service, and is paid from the time of retirement until the age of 62. The FERS supplement
ends at the age of 62 regardless of whether the individual applies for Social Security at that time.
Like Social Security benefits paid before the full retirement age (66 years in 2013), the
supplement is reduced if the retiree has earnings above a specified annual limit. This “FERS
supplement” is payable to Members who retire at the ages of 55 to 57 (depending on year of
birth) or older with at least 20 years of service. A former Member with at least 20 years of service
also may begin to draw the supplement upon reaching the age of 55 to 57.11
Social Security Retirement Benefits
Since January 1, 1984, all Members of Congress have been required to pay Social Security taxes.
The laws governing payment of Social Security taxes and eligibility for Social Security benefits
apply to Members of Congress in the same way they apply to any other covered worker.
Retirement with full benefits. The “full retirement age” under Social Security is 66 years in
2013. Forty quarters of covered employment are required to be eligible for retired worker
benefits.12 Under current law, the age for full benefits is gradually increasing, beginning with
people born in 1937, until it reaches the age of 67 for those born in 1960 or later.
Retirement with reduced benefits. The earliest that retired worker benefits can be taken under
Social Security is the age of 62. Benefits taken at 62 are permanently reduced, based on the
number of months between the person’s age at retirement and the full retirement age. A
worker retiring at the age of 62 in 2013 would receive a benefit equal to 75% of the benefit
that would be payable if the worker were retiring at the Social Security full retirement age.
When the full retirement age reaches the age of 67 in 2022 and later, the monthly benefit paid
at 62 will be 70% of the amount that would be paid if the beneficiary were aged 67.

10 The pension is reduced by 5% for each year the Member is under age 62 when the pension begins (unless he or she
has completed 20 or more years of service).
11 Members, former Members, and congressional staff can receive an unreduced annuity (and the FERS supplement)
with at least 20 years of service, provided they have reached the minimum retirement age of 55-57. Regular federal
employees must complete at least 30 years of service and reach the minimum retirement age of 55-57 before they are
eligible to receive an unreduced retirement annuity and the FERS supplement.
12 Fewer quarters of covered employment are required for individuals born before 1929.
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Social Security Earnings Limit13
Social Security benefits are reduced for beneficiaries under the full retirement age (age 66 in
2013) who have earnings from paid employment that exceed thresholds that are defined in statute.
In 2013, Social Security beneficiaries under the full retirement age of 66 are subject to a
reduction in benefits if their annual earnings exceed $15,120 ($1,260 per month) for any year
prior to the year in which they attain full retirement age. These beneficiaries lose $1 in benefits
for every $2 in earnings above the threshold.
For any months in the same year that Social Security beneficiaries attain full retirement age, the
reduction in benefits is lower and the annual exempt earnings amount is greater than described
above. That is, for any months in the year that a beneficiary meets the full retirement age for
Social Security (age 66 in 2013), the annual earnings limit is $40,080 ($3,340 per month). In
2013, individuals lose $1 in benefits for every $3 in earnings above the threshold for any of these
months.
The earnings thresholds described above are adjusted annually for average wage growth in the
U.S. economy. Retirees who have passed the full retirement age receive full benefits regardless of
earnings.
The Thrift Savings Plan: An Integral Component of FERS
The TSP is a defined contribution retirement plan similar to those authorized under Section
401(k) of the tax code for employers in the private sector. For all federal employees enrolled in
FERS, their employing agency contributes an amount equal to 1% of their base pay to the TSP,
whether or not the employee chooses to contribute anything to the plan. In 2013, employees
enrolled in FERS can make voluntary contributions of up to $17,500. FERS Employee
contributions of up to 5% of pay are matched by the employing agency. Employees covered by
CSRS can participate in the TSP, but they receive no employer matching contributions.
TSP employee contributions may be made on a pre-tax basis, in which case neither the
contributions nor investment earnings that accrue to the plan are taxed until the money is
withdrawn. Alternatively, P.L. 111-31 authorized a qualified Roth contribution option to the TSP.
Under a Roth contribution option, employee salary deferrals into a retirement plan are made with
after-tax income. Qualified distributions from the Roth TSP plan option—generally, distributions
taken five or more years after the participant’s first Roth contribution and after he or she has
reached the age of 59½—are tax-free.

13 For more details on this Social Security earnings limit, see CRS Report R41242, Social Security Retirement Earnings
Test: How Earnings Affect Benefits, by Dawn Nuschler.
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Required Contributions to Retirement Programs
CSRS
Regular federal employees covered by CSRS contribute 7.0% of pay to the Civil Service
Retirement System. Their employing agencies contribute a further 7.0% of payroll to the CSRS
on behalf of these workers. Members of Congress who are covered by CSRS are required to
contribute 8.0% of salary to the plan, and the Congress of the United States makes an employer
contribution of 8.0% of payroll on their behalf.
CSRS Offset
Members of Congress covered by the CSRS Offset Plan contribute 1.8% of pay up to the Social
Security taxable wage base ($113,700 in 2013), and 8.0% of pay above this amount, to the Civil
Service Retirement System. They also contribute 6.2% of pay up to the Social Security taxable
wage base to the Social Security trust fund.
FERS: Covered Prior to December 31, 2012
Regular federal employees who were covered by FERS prior to December 31, 2012, contribute
0.8% of pay to the Federal Employees’ Retirement System and their employing agencies
contribute an amount equal to 11.9% of pay in FY2013.14 Members of Congress and
congressional staff who were covered by FERS prior to December 31, 2012, pay 1.3% of salary
for FERS coverage, and Congress pays 16.7% of payroll for congressional employees and 18.3%
of pay for Members who are enrolled in FERS. Members and employees enrolled in FERS also
contribute 6.2% of pay up to the Social Security taxable wage base to the Social Security trust
fund.
FERS: Covered After December 31, 2012
Federal employees hired (or rehired with less than five years of FERS service) after December
31, 2012, are subject to increased contributions in accordance with P.L. 112-96 (the Middle
Class Tax Relief and Job Creation Act of 2012). Regular FERS employees hired in 2013 or later
contribute 3.1% of pay to their FERS annuity and their employing agencies will contribute 9.6%
of pay in FY2013. Members of Congress first elected in 2013 and congressional employees first
hired in 2013 also contribute 3.1% of pay. In FY2013, Congress contributes 9.6% of payroll for
these Members and congressional employees first elected or hired in 2013 who are enrolled in
FERS. Members and employees enrolled in FERS also contribute 6.2% of pay up to the Social
Security taxable wage base to the Social Security trust fund.

14 The employer contribution to FERS for each category of federal worker (regular federal workers, congressional
employees, and Members of Congress, for example) may vary slightly from year to year based on estimates of the
actuarial cost of the program made by the U.S. Office of Personnel Management.
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Temporary Increase in Employee Contributions to CSRS and FERS
Under the terms of the Balanced Budget Act of 1997 (P.L. 105-33), employee contributions
under CSRS and FERS rose by 0.25% in January 1999 and by a further 0.15% on January 1,
2000. Employee contribution rates were scheduled to increase by another 0.10% on January 1,
2001. Employee contributions were then to revert to the 1998 levels after December 31, 2002.
Pension benefits accrued by federal workers would not have increased as a result of the
temporarily higher employee contributions to CSRS and FERS mandated by the Balanced Budget
Act. The higher contribution rates mandated by the Balanced Budget Act were repealed for all
federal employees except Members of Congress by P.L. 106-346, the FY2001 Department of
Transportation and Related Agencies Appropriations Act. Contribution rates for Members
reverted to 8.0% under CSRS and 1.3% under FERS on January 1, 2003.
Social Security Payroll Taxes
All Members of Congress pay Social Security payroll taxes, regardless of their other retirement
plan coverage. The Social Security tax rate of 6.2% applies to gross wages up to $113,700 in
2013, which is the Social Security taxable wage base. The Social Security taxable wage base is
adjusted each year for wage growth in the economy.15 Members of Congress, like all other
workers covered by Social Security, pay Medicare Hospital Insurance taxes on all earnings at a
rate of 1.45% of pay.
Total Payroll Deductions
Total payroll deductions for federal retirement programs depend on the combination of programs
by which a Member is covered. The required payments are exclusive of any voluntary
investments in the TSP. The following are the required contributions in 2013.
Dual Coverage
Members with full CSRS coverage plus Social Security contribute 14.2% of the first $113,700 of
salary (8.0% to CSRS plus 6.2% to Social Security). They pay 8.0% to CSRS on salary above
$113,700.
CSRS Offset
Members in the CSRS Offset Plan pay 6.2% to Social Security and 1.8% to CSRS on the first
$113,700 of salary; they pay 8.0% to CSRS on salary above $113,700.
FERS
Members first elected before 2013 and who are enrolled in FERS pay 1.3% to FERS on total
salary and 6.2% to Social Security on the first $113,700 of salary. Members first elected after

15 Social Security taxes are levied on gross wages. They are not deducted for purposes of determining adjusted gross
income. TSP contributions are deducted in determining AGI.
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2012 and who are enrolled in FERS pay 3.1% to FERS on total salary and 6.2% to Social
Security on the first $113,700 of salary.
Social Security
All Members pay 6.2% of their first $113,700 in salary to Social Security. The taxable wage base
of $113,700 is indexed to national average wage growth and is adjusted annually.
Pension Plan Benefit Formulas
Pension benefits under both CSRS and FERS are computed according to (1) the retiree’s average
annual salary for the three consecutive years of highest pay (known as “high-3” average salary);
(2) the number of years of service completed under the pension plan; and, (3) the “accrual rate” at
which benefits accumulate for each year of service. The pension is the product of these factors,
expressed as follows:

High-3
Years of
Accrual
Annual

x
x
=
Salary
Service
Rate
Pension
Pension Benefits Under CSRS
The accrual rate for each year of congressional service covered by CSRS is 2.5%. Therefore, the
CSRS pension equals

High-3
Years of
CSRS

x
x .025 =
Salary
Service
Pension
For example, after 30 years of congressional service and a high-3 average salary of $174,000, the
initial annual CSRS pension for a Member who retired in December 2012 at the end of the 112th
Congress at the age of 60 or later would be16
$174,000 × 30 × .025 = $130,500
Federal law limits the maximum CSRS pension that may be paid at the start of retirement to 80%
of the Member’s final annual salary. (See 5 U.S.C. §8339(f).) To receive an initial pension equal
to 80% of final salary, a Member must complete 32 years of congressional service covered by
CSRS (32 × .025 = .80). The smallest starting pension under CSRS is 12.5% of high-3 salary for
a Member with five years of service. (Pensions based on less than 10 years of service cannot
begin before the age of 62.)
Most Members who entered Congress before 1984 and who chose to stay in the CSRS elected the
“CSRS offset” plan. When a Member who has retired under the offset plan is aged 62 or older,
the CSRS pension is reduced by the amount of Social Security benefits that he or she is entitled to

16 Base pay for Representatives and Senators was $174,000 in in 2010, 2011, and 2012. Pay for House and Senate
leadership positions is higher.
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as a result of congressional service. In the example above, the offset would be approximately
$18,345 in 2013.17
Pension Benefits Under FERS
For Members of Congress covered by FERS prior to December 31, 2012, the accrual rate for
congressional service covered by FERS is 1.7% for the first 20 years and 1.0% for each year
beyond the 20th. The basic retirement annuity under FERS for Members first elected prior to 2012
is equal to
[
Years of
Years of
High-3
Annual
x .017 x
Service
x .01 x
Service
Salary
] + [ High-3
Salary
] = Pension
through 20
over 20
Members who began congressional service before 1984 and who elected to join FERS will
receive credit under FERS from January 1, 1984, forward. Thus, at the close of the 112th Congress
in December 2012, a participant could have a maximum of 28 years of service under FERS.
Assuming that a Member retired at the end of 2012 with 20 years of congressional service under
FERS, and a high-3 average salary of $174,000, the initial annual FERS pension in 2013 would
be
[$174,000 × .017 × 20] = $59,160
For Members of Congress covered by FERS after December 31, 2012, the accrual rate for
congressional service covered by FERS is 1.0% per year of service, or, if the Member has at least
20 years of service and serves until at least the age of 62, the benefit accrual rate is 1.1% per year
of service. This is the same accrual rate that applies to regular FERS employees.
There is no maximum pension under FERS.18 (It would take 66 years of service under FERS to
reach the 80% maximum permissible under CSRS.) The smallest unreduced FERS pension is
8.5% of high-3 salary with five years of service (.017 × 5 years), which is payable no earlier than
the age of 62. A Member with 10 years of service who takes a FERS pension at the earliest
allowable age of 55 would receive a reduced pension equal to 11% of high-3 salary (.017 × 10
years, reduced by .05 times the seven-year difference between the individual’s age at retirement
and the age of 62).

17 This estimate, calculated for illustrative purposes, is based on the assumption that a Member of Congress who had
been in office on December 31, 1983 and who retired at the end of 2012 would have had 29 years of Social Security
participation as a Member of Congress. According to the Social Security Administration, the monthly benefit for a
career-long high-wage earner retiring at age 62 in 2012 (i.e., all 35 years of earnings in the calculation of Social
Security benefits were at the taxable maximum) would be $1,845. This would be $22,140 on an annual basis. This
amount was then multiplied by the ratio of 27/35, which is the proportion of Social Security participation as a Member,
to produce an estimated offset of $18,345.
18 It is important to remember that this FERS defined-benefit pension was designed to complement Social Security
participation and the Social Security benefit.
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Social Security Benefits
Social Security benefits are determined by a formula based on earnings in all Social Security-
covered employment. The benefit structure of Social Security was designed to replace a higher
proportion of earnings for lower-paid workers than for the higher-paid. For example, the initial
benefit payable to a low-wage worker who retired at the full retirement age in 2012 was $961 per
month, or $11,532 per year.19 This is equivalent to about 76% of the annual earnings of a worker
employed year-round, full-time at the minimum wage.20 For a worker whose earnings each year
were equal to or greater than the Social Security maximum taxable wage base, the initial benefit
paid to a new retiree at the full retirement age in 2012 was $2,513 per month, or $30,156 per year.
This is equal to about 27% of the maximum taxable wage base of $110,100 in 2012.
Pensions for Members with Service Under Both
CSRS and FERS
Members who were participating in CSRS when the FERS plan went into effect could elect to
leave CSRS and join FERS during a six-month “open season” in 1987.21 Members who switched
to FERS are entitled to a CSRS pension for the years before 1984, provided that they had
completed at least five years of service under CSRS by December 31, 1983. Their service from
January 1, 1984, onward is covered under FERS. When these Members retire, their pension is
computed using the CSRS formula for the CSRS-covered years and the FERS formula for the
years covered by FERS. The same high-3 salary, which is generally the salary earned in the three
years immediately preceding retirement, is used in both formulas. The two pension amounts
(CSRS and FERS) are then added together. For Members who switched from CSRS to FERS,
FERS rules govern the age and years of service for retirement eligibility.
For example, the pension for a Representative or Senator who retired in December 2012 at the
end of the 112th Congress with a total of 32 years of service (5 years covered under CSRS and 25
years covered under FERS) and a high-3 salary of $174,000 would be:
$174,000 ×
.025 × 5
=
$21,750
(CSRS)
+ $174,000
× .017 × 20 = $59,160
(FERS)
+ $174,000
× .01 × 5 = $8,700
(FERS)

Total pension = $89,610



19 The Social Security Administration defines a “low-wage” worker as one who earns 45% of the national average
wage or less.
20 $7.25 per hour × 40 hours per week × 52 weeks = $15,080. $11,532/$15,080 = .73.
21 P.L. 105-61, enacted on October 10, 1997, authorized a second open season from July through December 1998
during which employees covered by CSRS could switch to FERS.
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Retirement Benefits Under the CSRS Offset Plan
Members who were participating in CSRS before January 1, 1984, and who chose not to switch to
FERS could elect either to have full coverage under both CSRS and Social Security or to stay in
CSRS and have their CSRS contributions and benefits reduced (“offset”) by the amount of Social
Security taxes paid and Social Security benefits received. New Members who enter Congress
with at least five years of previous civilian federal employment that was covered under CSRS
also may join the CSRS Offset Plan. Under this plan, a Member pays 6.2% of salary up to the
Social Security taxable maximum ($113,700 in 2013) to Social Security and 1.8% of salary up to
this earnings level to CSRS. When annual earnings reach the maximum amount taxable under
Social Security, the Member pays 8.0% of salary for the rest of the year to CSRS. During
retirement, the individual’s CSRS pension is reduced by the amount of the Social Security benefit
that is attributable to his or her federal service. The reduction in the CSRS annuity begins at the
age of 62, whether or not the retiree elects to receive Social Security at that time.
As an example of the CSRS Offset Plan, assume that a Representative or Senator retired at the
end of the 112th Congress with 30 years of congressional service. According to the CSRS benefit
formula, this Member’s initial retirement annuity would be $130,500. However, if he or she were
aged 62 or older, this amount would be reduced by an amount equal to the Social Security
benefits earned from congressional service from January 1, 1984, through December 31, 2012.
For an individual retiring in December 2012 at the age of 62 with 29 years of congressional
service covered by Social Security, the reduction in 2013 would be approximately $18,345.22
Replacement Rates
The adequacy of pension plans is often evaluated by comparing the benefits paid at the time of
retirement with pre-retirement earnings. The initial annual pension is computed as a percentage of
final annual pay to derive the “earnings replacement rate.” This is the proportion of pre-retirement
earnings replaced by the pension. In both CSRS and FERS, pensions are based on the average of
the highest three consecutive years of earnings, which are usually the final three years before
retirement.
Table 1 shows the percentage of high-3 average pay replaced by a congressional pension for a
Member retiring with an immediate pension under CSRS or FERS at specified ages and years of
service. (Note that because FERS benefits apply only to service after 1983, no one will have
completed 30 years under FERS until 2014. Additionally, FERS benefits were designed to
complement Social Security benefits; therefore, FERS annuities necessarily have lower
replacement rates than CSRS annuities.)

22 See footnote 17 for calculation of this estimate.
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Table 1. Annuity Replacement Rates for Members

FERS:
FERS:
Covered Prior to December Covered After December
CSRS
31, 2012
31, 2012
Age 50, 20 years in Congress
42.5%
34.0%
20.0%
Age 55, 30 years in Congress
71.3%
44.0%
30.0%
Age 60, 10 years in Congress
25.0%
15.3%
10.0%
Age 62, 5 years in Congress
12.5%
8.5%
5.0%
Source: The Congressional Research Service.
Notes: These replacement rates reflect only an immediate pension annuity taken by a Member of Congress.
They do not include any Social Security or Thrift Savings Plan benefits. Unlike CSRS annuities, FERS annuities are
designed as a complement to Social Security benefits, as well as the individual retirement accounts that are part
of the Thrift Savings Plan. Therefore, FERS annuities necessarily replace less in former pay than CSRS annuities.
Cost-of-Living Adjustments
CSRS annuities are adjusted for inflation once each year on the same schedule and by the same
percentage as Social Security benefits. These “cost-of-living adjustments,” or COLAs, are based
on the rate of increase in the Consumer Price Index for Urban Wage Earners (CPI-W). CSRS
annuities and Social Security benefits are increased each January by the annual percentage
change in the CPI-W. As a cost-control measure, Congress has mandated that FERS annuities will
increase by less than the percentage change in the CPI-W whenever the annual rate of increase in
that index exceeds 2.0%. If the CPI-W rises by 2% or less, FERS annuities are increased by the
same percentage as the increase in the CPI. If the CPI rises by 2.1% to 3%, FERS annuities are
increased by 2%. If the CPI rises by more than 3%, FERS annuities are increased by one
percentage point less than the rate of increase in the CPI.23
Initial CSRS annuities may not exceed 80% of a Member’s final pay. Over time, however, if
congressional pay were to remain unchanged, a retired Member’s CSRS pension could exceed the
nominal amount of his or her final pay. Nevertheless, because COLAs merely prevent the
purchasing power of an annuity from being eroded by inflation, the real value of a CSRS pension
does not increase or decrease during retirement, provided that the price index on which the COLA
is based is an accurate measure of the rate of inflation.
The Thrift Savings Plan
The Thrift Savings Plan (TSP) is a retirement savings and investment program through which
federal employees can save money to supplement their pension income.24 The TSP is open to
participants in both CSRS and FERS, but in consideration of the smaller pensions paid by FERS,
Congress has authorized more generous incentives for workers covered by FERS to save for
retirement through the TSP. In 2013, FERS participants may invest up to $17,500 in the TSP. The

23 For more details on COLAs for CSRS and FERS pensions, see CRS Report 94-834, Cost-of-Living Adjustments for
Federal Civil Service Annuities, by Katelin P. Isaacs.
24 For a more thorough description of the Thrift Savings Plan, see CRS Report RL30387, Federal Employees’
Retirement System: The Role of the Thrift Savings Plan, by Katelin P. Isaacs.
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maximum annual contribution is indexed to inflation.25 Individuals enrolled in FERS who invest
in the TSP also receive a matching contribution from their employing agency on the first 5% of
pay that they invest in the plan. CSRS participants also may invest up to the annual statutory
maximum in the TSP, but they receive no employer matching contributions.
The government automatically deposits into the TSP an amount equal to 1.0% of basic pay on
behalf of an employee enrolled in FERS, regardless of whether the individual voluntarily invests
additional sums. Members of Congress and congressional staff become vested in this 1.0%
“agency automatic contribution,” plus any investment earnings on it after completing two years of
service. All participants in FERS are immediately vested in their own contributions and in
government matching contributions to the TSP, as well as any investment earnings on these
contributions. Unless an individual chooses the Roth TSP option, contributions to the TSP are
made on a pre-tax basis; contributions and investment earnings are not taxed until money is
withdrawn from the plan. Under the Roth TSP option, however, employee contributions are made
with after-tax income and qualified distributions from the plan are then tax-free.
Withdrawals from the TSP are subject to the federal income tax—except for qualified
distributions from the Roth TSP option—and withdrawals before the age of 59½ may be subject
to a 10% tax penalty.26 There is no penalty if the individual is aged 55 or older and is eligible for
an immediate pension from CSRS or FERS; if the withdrawals are in the form of a life annuity; or
if the withdrawals are taken in a series of “substantially equal periodic payments” on the basis of
the individual’s remaining life expectancy.27 Employees who leave federal employment can
continue to defer taxes on their TSP account balances either by leaving the money in the TSP or
by transferring all or part of these funds to an Individual Retirement Account (IRA) or other
eligible retirement arrangement, such as a 401(k) plan. At retirement, participants may withdraw
money from their TSP accounts in any of four ways. They can
• receive the account balance in a single payment.
• receive a series of monthly payments. (Payments may be for a fixed number of
months or a fixed dollar amount. Monthly payments also can be based on an IRS
life expectancy table.)
• purchase a life annuity.
• elect a partial distribution as a lump sum and take the remainder as either a series
of equal payments or as an annuity.
Participants who have separated from federal service must make an election for withdrawing
funds from the TSP no later than February 1 of the year following the year in which the later of
two events occurs: (1) the individual turns 65, (2) the individual reaches the 10th anniversary of
the first contribution to his or her account. Separated employees must begin withdrawals no later
than April of the year after they reach the age of 70½, at which time the TSP will begin to
distribute funds to the participant automatically if he or she has not yet made a withdrawal

25 The annual contribution limits are established in law at 26 USC §402(g).
26 There are some exceptions to the 10% penalty for withdrawals before age 59½. For more information, see CRS
Report R40192, Early Withdrawals and Required Minimum Distributions in Retirement Accounts: Issues for Congress,
by John J. Topoleski.
27 Individuals who separate from federal service before age 55 can receive monthly payments based on life expectancy
without a tax penalty and withdraw the remaining balance at age 59½ in a lump sum.
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election. Until an employee separates from the federal government, he or she can continue to
contribute to the TSP, regardless of age.
Mandatory Coverage Under FERS
Until the Legislative Branch Appropriations Act, 2004 (P.L. 108-83), all Members could opt to
decline coverage under FERS. Section 104 of P.L. 108-83, however, amended the provisions of
law applicable to coverage of Members of the U.S. House of Representatives under FERS.
Effective with passage of P.L. 108-83, Representatives (including a Delegate or Resident
Commissioner to the Congress) entering office on or after September 30, 2003, may not elect to
be excluded from such coverage. The changes under P.L. 108-83 did not affect Senators.
Therefore, all Senators and those Representatives serving as Members prior to September 30,
2003, continue to be able to decline FERS coverage.
Retirement Benefits for Members with
Limited Service
The vesting requirement to become entitled to a pension benefit under CSRS or FERS is five
years. Members who do not meet this five-year requirement—for instance, one-term Members in
the U.S. House of Representatives—are not entitled to an annuity under CSRS or FERS. It may
be the case, however, that an individual with less than five years of service as a Member may
meet this vesting requirement as a result of combining previous federal service or additional
federal service subsequent to service as a Member.28
To qualify for a retired worker Social Security benefit, an individual must accumulate at least 40
quarters of covered employment, or 10 years of Social Security-covered employment (among
other requirements). These Social Security benefits are based on the average of a worker’s highest
35 years of earnings. A Member of Congress with limited service may qualify for Social Security
benefits based on a lifetime earnings and employment history that includes more than
congressional service.
Finally, Members of Congress who participate in FERS—even Members with limited service—
are immediately vested in their own contributions and in any government matching contributions
to their TSP accounts, as well as any investment earnings on these contributions. In addition,
Members of Congress and congressional staff become vested in the 1.0% “agency automatic
contribution” to their TSP accounts under FERS, plus any investment earnings on it, after
completing two years of service.

28 For more details on age and length of service requirements for regular federal service under CSRS and FERS, see
CRS Report 98-810, Federal Employees’ Retirement System: Benefits and Financing, by Katelin P. Isaacs.
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Forfeiture of Annuity
Section 8312 of Title 5 provides that a federal employee, including a Member of Congress, may
not receive a retirement annuity for any period of federal service if that individual is convicted of
certain offenses that were committed during the period of service when the annuity was earned. In
general, the crimes that would lead to forfeiture of a federal retirement annuity under this
provision of law are limited to acts of treason or espionage.
Section 401 of the Honest Leadership and Open Government Act of 2007 (P.L. 110-81,
September 14, 2007) amended 5 U.S.C. Section 8332 to exclude from creditable service toward a
retirement annuity any service as a Member of Congress of an individual convicted of a felony
involving (1) bribery of public officials and witnesses; (2) acting as an agent of a foreign
principal while a federal public official; (3) fraud by wire, radio, or television, including as part of
a scheme to deprive citizens of honest services; (4) prohibited foreign trade practices by domestic
concerns; (5) engaging in monetary transactions in property derived from specified unlawful
activity; (6) tampering with a witness, victim, or an informant; (7) racketeer influenced and
corrupt organizations; (8) conspiracy to commit an offense or to defraud the United States; (9)
perjury; or (10) subornation of perjury.
The law directs the Office of Personnel Management to issue regulations to specify the
circumstances under which the spouse or children of such individual may be eligible for benefit
payments under CSRS or FERS, taking into consideration (1) the financial needs of the spouse or
children; (2) whether the spouse or children participated in a specified offense of which such
individual was convicted; and (3) what measures, if any, may be necessary to ensure that the
convicted individual does not benefit from any such payment.
Section 15(a) of the STOCK Act (P.L. 112-105, April 4, 2012) further amended 5 U.S.C. Section
8332 so that a Member of Congress would lose the credit for service as a Member for the
purposes of a retirement annuity if convicted of one of the numerous corruption offenses not only
during time served as a Member of Congress, but also if convicted of any of such offenses while
the President, the Vice President, or as an elected official of a state or local government.
In addition, Section 15(b) of the STOCK Act also adds other federal criminal laws relating
generally to public corruption or elections, for which a final felony conviction would result in
losing creditable service as a Member of Congress for federal pension purposes, including,
among other offenses, (1) criminal offenses include conflicts of interest; (2) conspiracy to make
false claims; (3) making false claims to the government; (4) vote buying; (5) illegal solicitation of
political contributions from federal employees; (6) soliciting political contributions in a federal
building or office; (7) theft, conversion, or embezzlement of government funds or property; (8)
false statements to the government; (9) obstruction of proceedings before government agencies;
or (10) attempt to evade or defeat paying taxes.

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Author Contact Information

Katelin P. Isaacs

Analyst in Income Security
kisaacs@crs.loc.gov, 7-7355

Acknowledgments
This report was originally prepared by former CRS Specialist Patrick Purcell. Please direct any inquiries to
the listed author.

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