How much is a FERS refund?

It is the deductions taken out of your basic pay, plus interest when the service totals more than a year. Under current law the rate turns on when you were first covered: 0.8 percent for the pre-2013 cohort, 3.1 percent for the 2013 cohort, and 4.4 percent from 2014 on. Special provision employees pay half a point more, so 1.3, 3.6 or 4.9 percent. Older service was withheld at other rates, because 5 U.S.C. 8422(a)(2) nets the gross percentage against the Social Security tax "then in effect": a regular employee paid 1.3 percent in 1987, 0.94 percent in 1988 and 1989, 1.05 percent in 1999 and 1.2 percent in 2000, and 1984 to 1986 CSRS Interim service is 1.3 percent. CBP officers paid the regular rate until June 29, 2008.

Does OPM pay interest on a FERS refund?

Only if the service covered by the refund totals more than one year. 5 U.S.C. 8401(19)(D) says the lump-sum credit "does not include interest if the service covered thereby aggregates 1 year or less, or for a fractional part of a month." Above a year, interest compounds annually at a rate the Treasury sets each year and OPM publishes. Under 5 CFR 841.605, each year's deductions earn half a year of interest in the year they are withheld, then the full rate every later year, and in the year OPM pays one twelfth of the rate for each full month before payment. The 2026 rate is 4.25 percent. It was 1.375 percent in 2021 and 13 percent in 1985.

Is a FERS refund taxable?

Your contributions are not, because they came out of pay you had already paid tax on. The interest is. IRS Publication 721: "If the refund includes only your contributions, none of the refund is taxable. If it includes any interest, the interest is taxable unless you roll it over." OPM withholds 20 percent of the interest absent a direct rollover, and separating before the year you turn 55 can add a 10 percent early distribution tax. For a qualified public safety employee the cutoff is earlier: before age 50 or 25 years of service, whichever comes first.

Can I pay a FERS refund back later?

Yes, if you were employed under FERS on or after October 28, 2009. 5 U.S.C. 8422(i), added by the National Defense Authorization Act for Fiscal Year 2010, lets you "deposit the amount received, with interest." Before that law there was no way back at all. The deposit has to be paid in full before OPM finalizes your annuity. OPM BAL 11-103: "If the redeposit is not paid in full, we will refund any partially paid redeposit and credit will not be given for the period of FERS refunded service in the annuity computation."

Does the date of my refund decide whether I can redeposit it?

No, and this is the detail most write-ups get wrong. OPM Benefits Administration Letter 11-103 keys eligibility to employment, not to the refund: the provisions "only apply to employees covered under FERS on or after October 28, 2009, and only affect annuities that are based on separations on or after October 28, 2009." A refund you took in 1996 is redepositable if you later held a FERS job on or after that date. A refund from 2008 is not, if you never worked under FERS again.

What happens to the service if I never redeposit it?

It depends on whether you were employed under FERS on or after October 28, 2009. If you were, the refunded service still counts toward whether you are eligible to retire, but it cannot be used to compute how much you get. OPM BAL 11-103: "If the FERS redeposit is not made, the refunded service is creditable in determining eligibility for retirement and survivor benefits, but it cannot be used to compute the amount of the retirement and survivor annuity benefits," and the law "does not allow credit for refunded service with an actuarial reduction." If you were not, the service counts for nothing at all. The same BAL says that before the 2009 law refunded service "could not be used in determining when the employee would become eligible to retire and it could not be used in computing the amount of the employee's annuity," and 5 U.S.C. 8424(a) says the refund "voids all annuity rights" for that service.

How is redeposit interest calculated?

From the date you received the refund, compounded annually at the same published variable rates, through December 31 of the year before you pay it off in full. A $10,000 refund received in January 2023 and repaid in 2026 picks up interest at 1.875 percent for all of 2023, 3.75 percent for 2024 and 4.375 percent for 2025, which comes to about $1,032. Received in December 2023, only one month of 2023 is charged and the interest is about $846. Waiting while rates are high makes the bill grow faster.

What form do I use, and who do I send it to?

SF 3106 for FERS, with SF 3106A as the notification your current and former spouses must receive. Do not use SF 2802, the CSRS form, because that mix-up delays payment. Separated 30 days or less, send it to your personnel office. Longer than that, send it to OPM. You must be separated at least 31 consecutive days and not annuity-eligible within 31 days of applying.

Calculator

FERS Refund Calculator

What leaving federal service pays back: the retirement deductions taken out of your pay, the interest OPM adds on top, the tax you owe on that interest, and what it would cost to buy the service back later.

Reviewed by Jonathan D., 20-year federal employee · Formulas verified against OPM BAL 11-103 · Updated October 2026

Taking the refund voids the annuity for that service

5 U.S.C. 8424(a) is blunt: payment of the lump-sum credit "voids all annuity rights" based on the service it covers, until you are reemployed under FERS. The way back is a redeposit with interest, and only if you were employed under FERS on or after October 28, 2009. Price both sides below before you file SF 3106.

Reviewed October 3, 2026 · Sources: 5 U.S.C. 8422 (rates, redeposit), 5 U.S.C. 8424 (refund), 5 CFR 841.605 (interest computation), 26 U.S.C. 3101(a) (OASDI rate by year), OPM BAL 11-103 (rates, redeposit rule), IRS Publication 721 (tax) · Inputs stay in your browser. Nothing you type is sent anywhere.

Average yearly basic pay

Basic pay across the service the refund covers. Locality pay counts. Overtime and awards do not.

Years of service the refund covers

A year or less pays no interest at all under 5 U.S.C. 8401(19)(D).

When were you first covered by FERS

Under current law that cohort pays 4.4 percent of basic pay. Earlier years can differ: the rate was 1.3 percent in 1984 to 1987, 0.94 percent in 1988 and 1989, 1.05 percent in 1999 and 1.2 percent in 2000 for a regular employee, and the tool applies each year's own rate. If you were rehired in 2014 or later but on December 31, 2013 you were in a FERS job or already had 5 years of creditable civilian service, you stayed on the older, cheaper rate, so pick that one (5 U.S.C. 8401(38)).

Position type

Special categories pay half a point more, each from its own start date. CBP officers pay it only for service after June 29, 2008; earlier CBP service was withheld at the regular rate.

Service began

You separated

Year OPM paid (or will pay) the refund

Interest keeps running while the application sits in processing, so a refund paid later is a bigger refund.

Month OPM paid (or will pay) it

Interest is compounded annually “through the last day of the month preceding the date OPM makes payment” (Handbook chapter 32, section 32B1.1-3 H2), so the payment month decides how much of the final year you earn. A January payment earns none of it; a December payment earns eleven months. On this page's default scenario, paid in 2021, that spread is worth about $256. Redeposit interest runs the other way, starting from the month the refund was paid.

Buying the service back

I was employed under FERS on or after October 28, 2009This, not the date of the refund, is what decides whether you can buy the service back. A refund taken in 1996 can still be repaid if you held a FERS job on or after that date.

Year you would pay the redeposit in full

Your refund comes to about $20,603: $19,008 of your own deductions plus $1,595 of interest. Buying the service back later would cost $23,069.

Your deductions

$19,008

4.4 percent of pay. Already taxed, so not taxable again.

Interest

$1,595

Published yearly rate, compounded, per 5 CFR 841.605

Total refund

$20,603

Before any withholding

Tax on the refund

IRS Publication 721 puts it plainly: if the refund includes only your contributions, none of it is taxable. The interest is taxable in the year you receive it unless you roll it straight into an IRA or another qualified plan. On a refund this size, the taxable part is $1,595, and OPM withholds 20 percent of it, about $319, if you do not elect a direct rollover. Separating before the year you turn 55 can add a 10 percent early distribution tax on the interest. For a qualified public safety employee the line is earlier: before age 50 or 25 years of service, whichever comes first.

Redeposit to restore the service

You were employed under FERS on or after October 28, 2009, so 5 U.S.C. 8422(i) lets you repay the refund with interest and restore full credit for that service. The redeposit has to be paid in full before OPM finalizes your annuity, and a partly paid redeposit is returned with no credit given.

Amount received

$20,603

Interest added

$2,465

Total due

$23,069

Each year's deductions are that year's rate times $72,000, for the months worked (service is counted from January of the start year). Under 5 CFR 841.605, a year's deductions earn half a year of that year's interest rate (in the last year of service, half the months worked plus the months after you left), then the full rate every later year, and in the payment year one twelfth for each full month before OPM pays.

Year by year deduction rate, deductions, published interest rate, interest credited and closing balance
Year	Deducted at	Deductions	Interest rate	Interest	Balance
2015	4.4%	$3,168.00	2%	$31.68	$3,199.68
2016	4.4%	$3,168.00	2%	$95.67	$6,463.35
2017	4.4%	$3,168.00	1.875%	$150.89	$9,782.24
2018	4.4%	$3,168.00	2.125%	$241.53	$13,191.77
2019	4.4%	$3,168.00	2.75%	$406.34	$16,766.11
2020	4.4%	$3,168.00	2.25%	$412.88	$20,346.99
2021	none	none	1.375%	$256.45	$20,603.44

Redeposit interest starts from the date the refund was paid and compounds yearly through the end of the year before you pay it off.

Year by year redeposit interest accrual
Year	Rate	Interest	Owed
2021	0.1146%	$23.61	$20,627.05
2022	1.375%	$283.62	$20,910.67
2023	1.875%	$392.08	$21,302.75
2024	3.75%	$798.85	$22,101.60
2025	4.375%	$966.94	$23,068.54

What this models

What the FERS Refund Calculator models and what it does not model
Modeled	Not modeled
The deduction rate for each calendar year under 5 U.S.C. 8422(a)(2): the 8422(a)(3) percentage for the cohort and position type less the Social Security rate then in effect (1.3 percent in 1987, 0.94 in 1988 and 1989, 1.05 in 1999, 1.2 in 2000 for a regular employee), 1.3 percent for 1984 to 1986 CSRS Interim service, and each special category from its own start date	Your actual pay history. One average salary is applied across every year of the service. Members of Congress and congressional employees, whose rates differ
Interest under 5 CFR 841.605(b): half a year in the year deductions are withheld, the last year of service by months worked and months after, full years after that, and whole months in the payment year, at the rates OPM published for 1984 through 2026	The exact day of the month OPM pays, and the 8401(19)(D) rule that no interest is paid for a fractional month of service. Either can move the figure by up to a month of interest
Service counted from January of the start year and continuous to the end of the years entered	A start month other than January, or breaks in service. Both shift which months earn the half-year interest, usually by a few dollars
CBP officers at the higher rate after June 29, 2008 and nuclear materials couriers after October 16, 1998	The pay periods on either side of those dates. For 2008 (CBP) and 1998 (couriers) the tool blends the two rates by day, and says so on the result. Special categories in 1984 to 1986 use BAL 11-103's 1.3 percent, which does not list them separately
The one-year bar in 8401(19)(D), which zeroes interest on short service	Years past 2026, which carry the 2026 rate forward as a stated assumption
The redeposit rule in 8422(i), keyed to FERS employment on or after October 28, 2009	The second half of OPM’s test, which concerns the annuity, not the refund: BAL 11-103 says the provisions “only affect annuity benefits based on a separation from FERS coverage on or after October 28, 2009.” The separation the refund came from can be any date. This bites mainly a reemployed annuitant, whose redeposit affects only a redetermined annuity “based on a separation from reemployment on or after October 28, 2009” and never the original retirement
Redeposit interest from the refund date through the year before payment in full	Installment payment schedules, which carry their own interest on the unpaid balance
The tax split: contributions already taxed, interest taxable, 20 percent default withholding	Your marginal rate, state tax, and whether the 10 percent early distribution tax applies to you
Civilian FERS deductions only	Military deposits, CSRS deductions in a mixed career, and voluntary contributions

Precision limit: OPM compounds interest annually “through the last day of the month preceding the date OPM makes payment” (Handbook chapter 32, section 32B1.1-3 H2), and this tool follows that, prorating the payment year by whole months. Pick the month you expect OPM to pay, because it matters: on the default scenario above, paid in 2021 at 1.375 percent, the spread between a January payment and a December one is about $256, or 1.2 percent of the refund. The same refund paid in 2026, at 4.25 percent, spreads by about $899. What is left over is the day of the month, worth at most one month of interest on the final balance. Only OPM can compute the binding amount.

The cohort you were hired into changes everything

Three people with identical careers get very different refunds. Someone first covered before 2013 has contributed 0.8 percent of basic pay since 2001. The 2013 cohort contributes 3.1 percent. Anyone first covered in 2014 or later contributes 4.4 percent, which is five and a half times the oldest rate for exactly the same pension.

A 2014 hire leaving after five years at $80,000 gets about $17,600 of their own money back, against $3,200 for a pre-2013 hire in the same job. The newer employee has more cash on the table and a weaker reason to keep the service.

The one-year rule is a real cliff

Interest is not prorated for short service. It is switched off. The statute bars interest when the covered service "aggregates 1 year or less," so a refund for exactly twelve months of work earns nothing, and a refund for thirteen months earns interest on the whole balance. If you are close to the line and the refund has not been filed, the arithmetic favours waiting.

Why the October 2009 date matters more than your refund date

Until the Fiscal Year 2010 defense authorization act, a refunded FERS period was gone for good. The two Handbook chapters that still say so, chapters 21 and 32, both date from 1998 and are superseded on this point. What replaced them is narrower than people assume: the test is whether you held a FERS job on or after October 28, 2009, not when the refund was issued.

That flips the usual advice. A mid-1990s refund is redepositable for anyone who came back to federal service in the last fifteen years. A 2008 refund is not, if the person never returned. The checkbox on this page asks it the way OPM does.