CSRS Offset,
clearly decoded.
CSRS Offset employees pay into both CSRS and Social Security simultaneously. That changes how your contributions are split — and how your annuity is calculated when Social Security kicks in at age 62.
What is
CSRS Offset?
CSRS Offset applies to employees who left and then returned to federal service, landing in a hybrid coverage position. The regular CSRS rules for eligibility, benefit computation, and cost-of-living adjustments all still apply — but the way contributions and eventual benefits are split is different.
If you have CSRS Offset coverage, you pay into Social Security and earn a Social Security benefit at the same time you are paying CSRS deductions and earning a CSRS annuity.
The regular CSRS rules described in the CSRS Eligibility section — when you can receive retirement benefits, how the benefit is computed, and cost-of-living adjustments — all apply to CSRS Offset employees. TSP participation rules are also the same for both CSRS and CSRS Offset employees.
You pay the same 7% total contribution as a standard CSRS employee — but the amount is divided between CSRS and Social Security.
Instead of paying 6.2% for Social Security on top of 7% for CSRS, the Social Security tax is subtracted from — or offset against — the 7% CSRS rate. When your total pay in a year exceeds the Social Security wage base, the Social Security deduction stops and your CSRS deduction increases to the full 7% of basic pay.
How your 7%
is divided.
The total cost to you is identical to standard CSRS — 7% of basic pay. The difference is in how that 7% is allocated between the two systems, and what happens when your salary crosses the Social Security wage base.
Standard CSRS
All deductions go to CSRS
CSRS Offset
Split between CSRS and Social Security
When does the offset actually happen to your annuity?
Your CSRS annuity is computed under the same rules as all CSRS employees. However, when you become eligible for Social Security benefits — normally at age 62 — your CSRS annuity is reduced by the value of your CSRS Offset service in your Social Security benefit.
No Social Security benefit? If you do not become eligible for any Social Security benefit, there is no offset applied to your CSRS annuity.
CSRS vs
CSRS Offset.
The two systems look similar on the surface — same eligibility rules, same annuity formula, same TSP access. The meaningful differences emerge in how contributions are split and what happens if you leave federal service.
| Feature | Standard CSRS | CSRS Offset |
|---|---|---|
| Eligibility rules | Standard CSRS age + service requirements | Same as standard CSRS |
| Annuity formula | Standard CSRS high-3 calculation | Same as standard CSRS |
| Cost-of-living adjustments | ✓ Full CSRS COLA | ✓ Full CSRS COLA |
| TSP participation | ✓ Same rules | ✓ Same rules |
| Social Security taxes paid | ✗ Not covered | ✓ 6.2% deducted |
| Social Security benefit earned | ✗ No SS benefit from federal service | ✓ Portable SS benefit accrues |
| Annuity reduced at age 62 | ✗ No reduction | ✓ Offset by SS benefit value from Offset service |
| Benefit if you leave early | CSRS deferred annuity only; no portable SS | CSRS deferred annuity plus portable Social Security benefit |
| Total contribution rate | 7.0% (all to CSRS) | 7.0% (split: ~0.8% CSRS + 6.2% SS) |
What happens if you
leave before retirement?
CSRS Offset employees who separate before retirement face the same early-departure drawbacks as standard CSRS employees — but with one meaningful advantage built in.
You receive the value of the CSRS benefit formula and cost-of-living adjustments, but you paid a smaller net amount for your CSRS benefit. You also have the flexibility of Social Security coverage that continues to build if you leave and work elsewhere.
If you leave the federal government before retirement, the same drawbacks that apply to standard CSRS employees who leave early also apply to you — reduced or deferred annuity, loss of certain benefits. However, you have paid far less into CSRS directly, and your Social Security benefit is fully portable: it travels with you to your next employer and continues to grow with additional covered employment.
The key advantage of CSRS Offset portability
Standard CSRS employees who leave early have only a deferred CSRS annuity to fall back on — and no Social Security benefit from their federal years. CSRS Offset employees leave with both: a deferred CSRS annuity and a growing Social Security record they can continue building in private-sector employment.
Additional
resources.
Official guidance, calculators, and reference reading for CSRS Offset employees planning their retirement.