How much are OPM interim payments?

Typically 60 to 80 percent of your estimated full annuity, and as low as 50 percent when OPM has incomplete data on your case. Only federal income tax is withheld during interim pay. Health and life insurance premiums, state taxes, and the survivor benefit reduction are all deferred until finalization.

Is FEHB deducted from interim payments?

No. Per OPM, health and life insurance coverage continues during interim pay, but premiums are not withheld. When your case is finalized, OPM withholds the missed FEHB and FEGLI premiums retroactive to your annuity commencing date, which shrinks the back-pay lump sum most retirees expect.

Do interim payments include the FERS supplement?

No. OPM confirms the FERS Annuity Supplement is not paid during the interim period at all. Eligible MRA retirees receive it retroactively at finalization, which can mean going months without $500 to $1,200 per month of expected income.

How long does interim pay last?

Until OPM finalizes your case. As of May 2026, digital applications averaged 66 days at OPM and paper averaged 105, on top of agency HR and payroll steps before OPM ever gets the file. Complex cases can sit in interim pay for a year or more.

Will I get back pay when my retirement is finalized?

Yes. OPM pays the difference between your full annuity and what interim payments covered, retroactive to your commencing date. But retroactive FEHB, FEGLI, and the survivor reduction come out of that lump sum first, so the check is usually smaller than the gross shortfall suggests, and it is taxable in the year received.

OPM Interim Payments: What Retirees Get While They Wait

Last Updated: July 8, 2026 Reading Time: 8 min

OPM ended paper retirement processing on July 1 and pledged first payments within 7 days of retirement. What the press release does not explain is what that first money actually is: an interim payment, typically 60 to 80 percent of your real annuity, with most of your deductions switched off. Retirees consistently misread both numbers, first the smaller check, then the smaller-than-expected lump sum at finalization after OPM claws back six months of insurance premiums. Here is the complete interim pay picture, with the worked math.

What Interim Pay Is and Why It Exists

When your agency sends your retirement package to OPM, your salary has already stopped, and full adjudication takes months. Interim pay is the bridge: OPM starts a provisional annuity, usually within days of receiving a complete file, based on what it can verify quickly.

The rate depends on how clean your record is. A straightforward career with verified service lands near 80 percent of the estimated net annuity. Cases with unverified service, military deposits, court orders, or part-time proration can start at 60 percent or lower.

The July 2026 digital shift genuinely helps here. With paper processing over for more than 95% of agencies, OPM's Online Retirement Application feeds cases in cleaner, and the agency has pledged a first payment within 7 days of retirement for complete applications filed by the separation date. Two caveats: the pledge assumes your agency HR and payroll steps run on time (they are the slowest part of the pipeline), and the 7-day payment is still an interim payment, not your full annuity.

What Comes Out of the Check, and What Doesn't

This is OPM's own rule, and it surprises almost everyone: during interim pay, only federal income tax is withheld. Everything else waits.

Deduction	During Interim	At Finalization
Federal income tax	Withheld	Withheld
FEHB premium	Not withheld (coverage continues)	Withheld + retroactive catch-up
FEGLI premium	Not withheld (coverage continues)	Withheld + retroactive catch-up
State income tax	Not withheld	Withheld going forward
Survivor benefit reduction	Not applied	Applied + settled in the lump sum
FERS Annuity Supplement	Not paid	Paid retroactively

Two consequences follow. First, your interim take-home is better than "70 percent" sounds, because the comparison final check carries deductions the interim one skips. Second, every skipped premium is accruing as a debt against your finalization lump sum.

The Worked Example: GS-13, $60,000 Annuity, 6 Months in Interim

Take a retiree with a $5,000/month gross FERS annuity, full survivor election, a mid-range self-plus-one FEHB plan at $350/month, FEGLI Basic at $40, and a 70 percent interim rate.

Monthly cash while in interim:

Item	Amount
Interim gross (70% of $5,000)	$3,500
Federal tax (~11%)	-$385
FEHB / FEGLI / state / survivor	$0 (all deferred)
Net to the bank	$3,115

The final monthly check, once adjudicated: $5,000 gross, minus the $500 survivor reduction, $350 FEHB, $40 FEGLI, $495 federal tax, $100 state tax = $3,515 net.

So the real monthly gap during interim is about $400, not the $1,500 the gross numbers imply. The bigger shock arrives with the settlement:

Finalization lump sum	Amount
Full annuity due (6 x $4,500 after survivor)	$27,000
Interim already paid (6 x $3,500)	-$21,000
Gross shortfall	$6,000
Retroactive FEHB (6 x $350)	-$2,100
Retroactive FEGLI (6 x $40)	-$240
Net lump sum (before income tax)	~$3,660

Retirees who spent six months expecting a $6,000 check get $3,660, and it is taxable in the year received. The tax mechanics of that back-pay lump sum are their own trap, covered in our OPM retirement back pay tax guide.

The FERS Supplement Gap Nobody Mentions

If you retire at your Minimum Retirement Age with 30 years, or at 60 with 20, you are entitled to the FERS Annuity Supplement, the Social Security stand-in worth roughly $500 to $1,200 a month for most career retirees. OPM's FAQ is explicit: the supplement is not included in interim payments. It arrives retroactively at finalization.

For an MRA retiree counting on the supplement, the real interim income gap is the $400 from the table above plus the entire supplement. Budget for that combined number, not the press-release version.

How to Keep Your Interim Period Short

File through ORA before your separation date. The new pre-retirement application lets you and HR complete the package early, and the 7-day pledge only applies to complete, on-time submissions.
Clear your deposits first. Unpaid military deposits and civilian redeposits are the classic interim-rate killers. Settle them before you retire, not during adjudication.
Audit your eOPF for gaps. Missing SF-50s and unverified service put you at the 50-60 percent end of the range.
Know your full-annuity number. Run the FERS Retirement Calculator, then compute 60 and 80 percent of the result. That range is your interim planning band. If you are not sure of your starting salary figure, the High-3 Calculator pins it down.
Keep 2-3 months of expenses liquid for the stretch between your last paycheck and the first interim deposit, especially if your agency's payroll closeout runs slow.

Frequently Asked Questions

How much will my interim payments be?

Typically 60 to 80 percent of your estimated annuity, lower if OPM lacks data on parts of your service. Only federal income tax is withheld, so the net lands closer to your eventual final check than the percentage implies.

Does my FEHB coverage lapse during interim pay?

No. Coverage continues even though premiums are not being withheld. OPM collects the missed premiums retroactively at finalization, out of your back-pay lump sum.

Why is my finalization check smaller than the shortfall I calculated?

Because the retroactive FEHB and FEGLI premiums, plus the survivor reduction settlement, come out first. A $6,000 gross shortfall on a typical GS-13 case nets around $3,660 before income tax.

Is the FERS supplement paid during interim?

No. It is paid retroactively when your case finalizes. If you retired at MRA, plan for months without it.

How long will I be in interim pay?

Until adjudication finishes. May 2026 averages: 66 days for digital cases and 105 for paper at OPM, after your agency completes its own HR and payroll steps. Complex cases with deposits, court orders, or record gaps can run past a year.

FERS Retirement Calculator: Your full annuity estimate, the base for the 60-80% interim band
High-3 Calculator: Pin down the salary average your annuity is built on
OPM Retirement Back Pay Tax Guide: What the finalization lump sum does to your taxes
OPM Retirement Processing Times: The current backlog, the digital shift, and how to speed your case

Sources: OPM interim pay FAQ, OPM FERS supplement and interim pay FAQ, OPM "Last Day of Paper" release, NARFE