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Military Service Deposits

A military service deposit is a payment made to the civilian retirement fund to allow creditable military service to be used toward retirement eligibility and in annuity computations.

  • All active duty military service is potentially creditable for retirement purposes.
  • You may need to pay a deposit in order to receive retirement credit for it.
  • There is a 2-year grace period from the date of your first retirement coverage to pay a military deposit in full and not be charged any interest. On the 3rd year anniversary of retirement coverage, interest will accrue annually until the deposit is paid.

If you have any question about whether your particular military service is creditable, check with your Benefits Specialist early in your career to find out. For example, creditable service can include active duty for training "summer camps" in the Reserves, Military Academy service, and retired military and National Guard service under certain circumstances.

If you decide to pay the military deposit, it must be paid in full before you retire. Service periods that have a break of at least one day can be paid separately. The process to pay the deposit can take time so don't wait until right before retirement to begin!

How is Military Service Credited?

  1. Military service before January 1, 1957, is creditable without payment of a deposit.
  2. Hired under CSRS before October 1, 1982

    Deposit paid. Your military service will be credited for retirement eligibility and computation of annuity.

    Deposit not paid. Your military service will be credited for eligibility and computation of annuity if you are not yet age 62 at retirement. If at age 62 (or at retirement if already 62) you are eligible for a Social Security benefit and the deposit has not been paid prior to retirement, your retirement annuity will be recomputed by subtracting the military service time from your total service. This typically reduces the CSRS annuity by 2% for each year of service.

    However, if you will not be eligible for Social Security at age 62 (or at retirement if already 62), no deposit is required and you will receive full credit for your military service with no future reduction.

  3. Hired under CSRS on or after October 1, 1982

    A military service deposit must be paid to receive credit for retirement eligibility and annuity computation purposes.

  4. Hired under FERS

    FERS covered employees must pay a military service deposit to receive credit for civilian retirement eligibility and annuity computation.

    FERS employees with a CSRS component (5 years of creditable civilian CSRS service prior to FERS) are subject to CSRS military deposit rules.

  5. Uniformed Services Employment and Reemployment Rights Act (USERRA)

    The deposit rules also apply to active military service that interrupts a period of Federal civilian service and you are restored or reemployed on or after August 1, 1990 under the provisions of USERRA. Service under LWOP-US is creditable if a deposit is paid. The deposit amount would be the lesser of the earnings based on civilian salary or military salary.

How Much is the Deposit?

CSRS - The amount of deposit is equal to 7% of military base pay earned, plus accrued interest.

FERS - The amount of the deposit is equal to 3% of the military base pay earned, plus accrued interest.

The rate increases for military service performed in 1999 to 3.25% and for 2000 to 3.4% of the base pay.

Interest is charged at the variable rate established annually by the US Treasury if it is not paid in full within the 3-year period from retirement coverage.

What are the Steps for Paying the Deposit?

Step 1. Request Military Earnings

  • Complete the RI 20-97 form
    • If you were on active duty during a period of leave without pay from your Federal position (LWOP-US), and during this time received civilian pay subject to retirement deductions by using either annual or military leave, you will owe a deposit only for the period not covered by civilian pay and retirement deductions. On the RI 20-97 form, note "I am requesting estimated military earnings for only a portion of my active military duty. Please see attachment." Click here to see a sample.
  • Attach form DD 214 or equivalent (Instructions and Information). If you do not have a DD 214 you can request a copy by completing the SF-180 form.
  • Send RI 20-97 and DD 214 to appropriate pay center as indicated online at

Step 2. Computation of Deposit and comparison annuity estimates

  • The military payroll office will return the RI 20-97 form to you indicating your total estimated earnings during your military service. This can often take several months.
  • Provide a copy of the earnings statement to your Benefits Specialist who will compute the amount of the deposit owed.
  • Depending on the situation, comparison retirement annuity estimates may also be run to help you decide whether to pay the deposit or not.

Step 3. Paying the deposit

  • Ask questions of your Benefits Specialist if needed so that you understand what you are gaining by paying the military service deposit.
  • Complete the Application form – SF 2803 for CSRS or SF 3108 for FERS. Complete pages 1 and 5 and sign.
  • Complete the Payment Authorization form. You can choose to pay the deposit in full by writing a check (keep a copy for your records) or you can authorize payroll deductions.
  • Please ensure you have provided a copy of the approved documents to the Benefits Specialist when submitting the above items.

Step 4. The Benefits Specialist will forward your military deposit application package to IBC payroll for processing.

Step 5. When the deposit is paid in full, the payroll office will send you a letter documenting payment. It is very important that you keep this document for your permanent retirement records as proof of payment for retirement purposes. Provide a copy to your Benefits Specialist to include in your official records.

Your Service Computation Date (SCD) for Retirement will be updated in the payroll database by the Benefits Specialist once confirmation of payment in full is received, if applicable.


Additional Resources

OPM Retirement Handbook Chapter 22, Creditable Military Service

OPM Retirement Handbook Chapter 23, Service Credit Payments for Post-1956 Military Service

Office of Personnel Management (OPM) Benefits Administration Letter 03-105, Computing the Post-1956 Military

Deposit for Employees on LWOP-US Who Receive Civilian Pay During Their Active Military Duty and Attachment


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