What Must Federal Employees Know About Retirement Benefits During Divorce?

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As a federal employee, you have considerable stress and responsibility at work. Unfortunately, going through a divorce can only complicate these matters further. If you work for the United States, you’re entitled to certain benefits. Understanding what happens to these benefits when you and your spouse divorce can help make the process less overwhelming. Keep reading to learn what federal employees must know about these benefits and explore how a Los Angeles divorce attorney can help make the transition to the next chapter of your life as smooth as possible.

What Benefits Do Federal Employees Receive?

There are a number of benefits that federal employees receive as workers for agencies and services of the United States.

When it comes to retirement benefits, employees generally receive benefits under FERS or the Federal Employees Retirement System. Enacted in 1987, this system provides benefits from social security, a Thrift Savings Plan (TSP), and a basic benefit plan. You will pay the full amount of Social Security taxes and put a small amount toward the Basic Benefits. Similarly, 1% of your pay from each period will go into your TSP, which reflects a traditional 401k plan. These three plans work together to help ensure you can retire with the funds you need.

Like many other employees, federal workers will also receive comprehensive health insurance. Similarly, state employees partake in the Federal Employee Group Life Insurance Program, which does not have a cash value but can be assigned one by the courts.

What Benefits Are Spouses Entitled To?

When a federal employee and their spouse divorce, the spouse may be entitled to certain benefits, just as they would if they had divorced a non-federal employee.

It’s important to understand that the retirement plan of a federal employee will be divided, as it is often deemed marital property. Because these have considerable value, they are often a source of tension for divorcing couples. As such, the assets you receive under FERS may be subjected to payment for a former spouse. Similarly, any funds accrued in your TSP during your marriage are subject to division.

It’s important to understand that the pension received by federal employees is different than that of those in the private sector. As such, the Employee Retirement Income Security Act (ERISA) does not apply, so the spouses cannot collect their share until the federal employee does.

Under certain circumstances, your ex-spouse may be able to continue to receive benefits under your health insurance. However, they must pay the premium cost on their own, but they have a considerable amount of plans to choose from under the Federal Employee Health Benefits (FEHB) program.

As you can see, there are many complications that can arise for federal employees going through a divorce. This makes it more important to consult an experienced divorce attorney to help you understand the complexities of this process. When you need help, the Zitser Family Law Group is here to assist you. Our dedicated legal team has the necessary experience to guide you through this process. Contact us today to learn more.

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