Credit for Military Service Under Civilian Federal Employee Retirement Systems [October 25, 2011] [open pdf - 250KB]
"Federal employees with permanent appointments earn pension benefits under one of two retirement plans. Employees hired after 1983 participate in the Federal Employees' Retirement System (FERS). Employees hired before 1984 participate in the Civil Service Retirement System (CSRS) unless they elected to transfer to the FERS during open seasons held in 1987 and 1998. When Congress established the CSRS in 1920, it allowed veterans who subsequently became civilian federal employees to count their years of active-duty military service toward retirement eligibility and pension benefits under CSRS. The statutes that allow military service to be credited toward a civil service pension have been amended several times over the years, mainly to coordinate civil service retirement benefits with benefits earned under Social Security. Under both CSRS and FERS, federal employees who have served on active duty in the military can have their years of military service counted for retirement eligibility and pension benefits. The employee may be required to make a deposit to the Civil Service Retirement and Disability Fund (CSRDF) for military service to be credited toward a civil service retirement annuity. […] For employees enrolled in CSRS, the required deposit is 7.0% of the total amount of basic pay received while on active duty in the military. For employees enrolled in FERS, the required deposit is 3.0% of their total basic military pay. If the employee makes the deposit within two years of being hired into civilian federal employment, no interest is charged."
CRS Report for Congress, R40428