Top federal officials have put out a "don't call us, we'll call you" message to employes worried about a new pension plan that takes effect in January for some workers. Personnel offices say they are flooded with calls from workers who think they are under some kind of deadline.
The 400,000 workers who have been hired since January 1984 don't have to do anything, officials say, because coverage for them is mandatory -- and automatic.
Under their new plan, benefits will come from Social Security, a modified civil service pension and earnings from an optional tax-deferred investment program, similar to 401k plans in the private sector.
Workers hired before 1984 will be given the option of remaining in the current civil service retirement plan or switching over to the new system next summer.
These employes don't need to decide until this time next year, officials say. There will be a lengthy "open season" when workers can weigh the pros and cons of joining the new system.
OPM says it will be sending each employe fact sheets on benefits, costs and retirement ages under the new system.
So, if you are a new employe (hired since January 1984) there is nothing you can or should do. If you are a pre-1984 federal hiree, there is plenty of time to decide. Pension Tax Change
Senate-House conferees are expected to eliminate the so-called three-year recovery rule as part of overall tax reform. The main question is when the change will take effect.
Under current law, persons who contribute to their own pension plans are allowed to recover their previously taxed contributions before their annuities are taxed. About 20 million American workers, including all federal employes and many state and local government workers, contribute to their pension plans and benefit from the recovery period.
The Senate version of tax reform would eliminate the three-year rule in two phases, beginning in January 1988. The House bill eliminates it retroactive to July 1. Either way, when the law is fully effective, retirees would be required to begin paying taxes immediately on a prorated share of the government contribution to their pensions based on life expectancy.
Federal and postal organizations continue to work to save the three-year rule, but the odds are against it. They are urging members to contact conference committee members to protest the proposed change.
Senate GOP conferees are Bob Packwood (Ore.), Robert J. Dole (Kan.), William V. Roth Jr., (Del.), John Chafee (R.I.), John C. Danforth (Mo.) and Malcolm Wallop (Wyo.). Democrats are Russell B. Long (La.) Lloyd Bentsen (Tex.), Bill Bradley (N.J.), Spark M. Matsunaga (Hawaii) and Daniel P. Moynihan (N.Y.).
House Democratic conferees are Dan Rostenkowski (Ill.), J.J. Pickle (Tex.) Charles Rangel (N.Y.), Fortney H. Stark (Calif.), Richard A. Gephardt (Mo.), Marty Russo (Ill.) and Donald J. Pease (Ohio). Republican members are John Duncan (Tenn.), Bill Archer (Tex.), Guy Vander Jagt (Mich.) and Philip Crane (Ill.).