FERS Disability Retirement

Your Safety Net If You Can't Keep Working

Understanding disability benefits and the application process

Not everyone retires on their own terms. If a medical condition prevents you from continuing in your federal job, FERS Disability Retirement provides a critical fallback — offering partial income, continued FEHB access, and long-term protection. This guide explains how it works, who qualifies, and what to expect.

🩺 What Is FERS Disability Retirement?

FERS Disability is not based on age or years of service — it's designed for employees who:

Can no longer perform their job due to medical reasons, and
Have at least 18 months of creditable federal civilian service

✅ If approved, you receive:

A monthly annuity (based on a special formula)
Continued FEHB/FEGLI access
Option to later convert to "regular" FERS at age 62

✅ Eligibility Requirements

To qualify, you must meet all of the following:

Requirement	Explanation
18+ months of creditable service	Civilian service only (military buyback doesn't count for this threshold)
Medically unable to perform your duties	Must be certified by a licensed doctor
Disability expected to last at least 1 year	Temporary conditions don't qualify
Agency must state it cannot accommodate or reassign you	Critical — must be documented in writing
Must apply for Social Security Disability Insurance (SSDISocial Security Disability Insurance - A federal program that provides benefits to people who cannot work due to disability. FERS disability recipients must apply for SSDI even if they may not qualify.)	Even if denied, you must apply to meet OPM's rules

🧠 You do not need to be approved for SSDI to receive FERS Disability — but you must show proof of application.

💰 How the Annuity Is Calculated

FERS Disability uses a two-phase formula:

Phase	Amount	Notes
Year 1	60% of your High-3Your highest average basic pay earned during any 3 consecutive years of service, typically your last 3 years before retirement average salary	Minus 100% of any SSDI payments
Years 2 until Age 62	40% of your High-3	Minus 60% of SSDI payments

At age 62, your disability annuity is recalculated as if you had worked full time to age 62 — including credit for unused sick leave and earned years of service.

⚠️ Key Considerations

Topic	Details
SSDI Offset	Your FERS Disability annuity will be reduced based on your SSDI award
FEHB & FEGLI	You retain eligibility if enrolled at retirement and meet 5-year rule
TSP	You can't contribute, but you can leave your balance alone or withdraw
Survivor Benefits	Standard elections apply
COLAsCost-of-Living Adjustments - Annual increases to retirement benefits to help offset inflation. Disability retirees don't receive COLAs until age 62.	You are not eligible for COLAs before age 62 under disability retirement

📤 The Application Process

You must submit:

SF-3107 (Application for Retirement)^[OPM]
SF-3112 (Disability Documentation Packet)^[OPM]
Medical records from licensed physician
Agency letter stating they cannot accommodate or reassign you
Proof of SSDI application (receipt or letter)

⏰ It's strongly recommended to submit within 1 year of separation from service. Applications filed after this deadline may be denied.

🧾 After Approval

Once approved:

You begin receiving monthly annuity checks
You may seek outside employment, but income is subject to review (see below)
You must certify annually that you remain disabled (until age 60)

🔁 Reexamination & Income Limits

You can lose your disability benefit if:

You are medically recovered
You earn income above 80% of your prior federal salary

Each year, OPM may require:

A new physician statement
IRS tax return and W-2s

🚨 Recovery or reemployment at a similar salary = termination of disability annuity. Always report income changes to OPM promptly.

❗ What Happens at Age 62

At 62, your disability retirement is converted to a regular FERS annuity, as if:

You worked continuously from your separation date until age 62
You earned credit for unused sick leave
You paid into FERS the whole time

This provides a smoother transition and often increases your annuity. You'll also become eligible for COLAs starting at age 62.^[OPM]

🛡️ Pros and Cons Summary

Pros	Cons
Income replacement if you can't work	No COLAs before age 62
Access to FEHB/FEGLI	Requires documentation and annual medical review
Full pension recalculation at 62	SSDI offset reduces payment
Can work part-time if able	Income limits (80% rule) apply
Protects your retirement benefits	Application process can be lengthy

📎 Forms & Resources

Essential forms and documentation:

✅ Key Takeaway

FERS Disability Retirement is a powerful safety net — but you must act quickly after becoming disabled, gather documentation, navigate SSDI coordination, and plan for long-term income limitations. If you're unsure whether you qualify, apply early — denial is better than missing the deadline.