Guide
Which Service Counts, and Which Only Counts Halfway
Federal service answers two questions, and the same year of work can answer one of them and not the other. Where each kind of service lands on both.
“Creditable service” sounds like one thing. It is two. Federal retirement asks a length-of-service question twice — once to decide whether you may retire at all, and once to decide what the annuity pays — and several kinds of service answer one of those questions and not the other.
That is why someone can be perfectly eligible to retire on the date they planned and still receive an annuity computed on three fewer years than they counted. Nothing went wrong; two different rules were applied to the same career, which is what the statute says to do.
The whole picture, in one table
| Kind of service | Eligibility | The computation | Rule |
|---|---|---|---|
| Ordinary covered service | Counts | Counts | 5 U.S.C. § 8411 |
| Unused sick leave | Never | Counts | § 8415(m)(1) |
| Part-time service | Counts in full | Prorated by hours | § 8415(g) |
| Post-1956 military service, deposit paid | Counts | Counts | § 8411(c) |
| Post-1956 military service, deposit unpaid | Never | Never | § 8411(c); § 8422(e) |
| FERS non-deduction service before 1989, deposit unpaid | Never | Never | § 8411(b)(3) |
| FERS non-deduction service from 1989, at any price | Never | Never | Handbook § 21B2.1-1A2 |
| FERS refunded service, redeposit unpaid | Counts | Never | Pub. L. 111-84 § 1904 |
| CSRS deposit service before 1 Oct 1982, unpaid | Counts | Counts, annuity reduced | § 8339(i) |
| CSRS deposit service from 1 Oct 1982, unpaid | Counts | Never | Handbook § 21A2.1-3D |
| CSRS refunded service ending before 1 Oct 1990, unpaid | Counts | Counts, annuity reduced | Handbook § 21A3.1-3B |
FERS unless the row says CSRS. “Never” means the service is not credited for that purpose while the payment is outstanding; paying the deposit or redeposit in full moves the row to “counts” in every case where a payment is possible at all.
Three consequences worth knowing before you plan a date
Sick leave cannot move your retirement date. § 8415(m)(1) credits unused sick leave to the service used in the computation and bars it from “annuity eligibility” in the same sentence. A balance of 1,200 hours is worth six months of credit in the computation — on a $96,000 high-3 with 25 years of service, $528 a year — and worth exactly nothing toward the date you may go.
The 20-year test for the 1.1% factor is an eligibility-side test. The enhanced accrual factor is a computation rule, but the 20 years it requires are counted without sick leave. Someone with 19 years and 8 months of service and a large sick leave balance retires at 1%, not 1.1%, however the computation comes out afterwards.
Eligibility-only service is the expensive case. A FERS employee who took a refund and never repaid it keeps the time for eligibility and loses it from the computation entirely. Three such years on a $96,000 high-3 with 25 years of total service is the difference between $26,928 a year and $23,760 — $3,168 every year, for a career that looks identical on paper and retires on the same day.
The two rows that reverse the intuition
Most of the table reads as expected: pay for the service and it counts, do not pay and it does not. Two rows do the opposite, and both are CSRS.
CSRS deposit service before 1 October 1982 is credited in full whether or not the deposit is paid. 5 U.S.C. § 8339(i) reduces the annuity by 10% of the balance owed instead, permanently. So the employee is not buying credit they lack — they already have it — they are buying off a reduction. That changes the arithmetic completely: the question is whether paying the balance beats losing a tenth of it every year for the rest of your life, which for most people it does, and quickly.
CSRS refunded service ending before 1 October 1990 works the same way, with an actuarial reduction rather than a fixed percentage. OPM computes it from published present-value factors, so the price is real but is not a figure anyone can quote from the statute.
And the row with no remedy
Non-deduction service performed under FERS on or after 1 January 1989 is not creditable for any purpose, and no payment makes it so. It is the only line in the table with no price attached, because it is not for sale. Anyone who spent time on a temporary appointment after 1988 before converting to a permanent position should assume those years are absent from both answers, and plan the date accordingly.
Sources
- 5 U.S.C. § 8411 — FERS creditable service, including the military deposit at (c) and the post-1988 bar at (b)(3). Text of § 8411
- 5 U.S.C. § 8415 — the computation: part-time proration at (g), the 1.1% factor at (i), sick leave at (m). Text of § 8415
- 5 U.S.C. § 8339(i) — the 10% annuity reduction for an unpaid pre-October-1982 CSRS deposit. Text of § 8339
- OPM CSRS/FERS Handbook, Chapter 21 — crediting effects at §§ 21A2.1-3, 21A3.1-3 and 21B2.1-1. Chapter 21 (PDF)
The annuity figures above come from lib/fers-annuity.js, the module behind the FERS calculator. What this guide does not do is price your own deposit or redeposit balance — interest accrues annually and the answer depends on dates only your record holds, which is what the calculator below is for.
Related tools
What it costs to make federal civilian service count — the deposit for time worked with no retirement deductions and the redeposit for time you took a refund for, with OPM's compounded interest and the rule that decides what happens if you never pay.
Open tool →Military Buyback CalculatorWhat it costs to add military service to your federal pension — 3% of your military basic pay under FERS, plus every year of OPM's compounded interest — and how long the larger annuity takes to pay it back.
Open tool →Sick Leave Conversion CalculatorConvert unused sick leave hours into the months of service credit OPM's 2,087-hour chart actually grants — including the odd days that get dropped.
Open tool →FERS Part-Time Proration CalculatorWhat part-time federal service does to your pension — the proration factor built from the hours you actually worked, the annuity the same career would pay full-time, and the gap between them. Your eligibility dates do not move.
Open tool →This guide is informational only. It is not financial, tax, or legal advice, and FedAnnuity is not affiliated with OPM or the U.S. government. Retirement rules turn on the specific facts of a career, and only your agency and OPM can give you a binding figure.
Last reviewed: August 2026 · Against 5 U.S.C. §§ 8411, 8415 and 8339, and OPM Handbook Chapter 21.