§2071 Lump-sum Payments

Summary

A former agency employee can get a one-time lump-sum payment of their retirement credit if they have been separated from the agency for at least 31 consecutive days, are not moved to another government retirement system, file an application, are not working in a covered position when they apply, and will not become eligible for an annuity within 31 days after applying. If a former spouse has a legal claim, the lump-sum is split. Unless a court order or spousal agreement says otherwise, a former spouse gets 50% of the lump-sum if they were married to the employee for the whole time that gave credit. If they were married only part of that time, they get a proportional share of that 50%. Any amount paid to a former spouse reduces the former employee’s share. Payments that would affect a survivor annuity must follow any court order. Before paying a lump sum to or for a former employee, the agency must notify the current spouse and any former spouses with claims, and the current spouse must agree in writing. If the person dies or other special situations happen, unpaid lump sums and unpaid annuities are paid in this order to people alive when the right to payment starts: a beneficiary named in a signed, witnessed form on file with the Director; if none, the surviving spouse; then children (and descendants); then parents; then the executor or administrator of the estate; then other next of kin the Director finds legally entitled. If a deferred annuitant dies before age 62, or if annuity payments stop before the total reaches the lump-sum credit, the remainder is paid in that same order and reduced for any former-spouse share. If a survivor annuitant’s annuity ends for reasons other than death, any unpaid amount goes to that person. If a survivor annuitant dies, unpaid amounts go to the executor or, if none, to next of kin, but not until 30 days after the death.