Federal employees going through the divorce process may encounter more challenges than those working in the private sector. Retirement savings, health insurance and other federal employee benefits can complicate and prolong divorce proceedings due to the complex state and local laws that govern these divorce cases. Working with a knowledgeable law attorney with experience in federal employee divorce is key to reaching a satisfactory outcome.
It is also important for federal employees and their spouses to become familiar with federal employee divorce rights. The following frequently asked questions and answers help shine a light on how federal employee divorce cases may be managed.
1. When Does A Former Spouse Stop Being Covered By Employee Benefits?
One of the most common questions asked by federal employees is at what point will their former spouse stop being covered by employee benefits such as medical, vision and dental. The federal employee’s former spouse will be removed from the employee’s medical, vision or dental insurance upon the finalization of the divorce.
Once coverage is terminated, the former spouse will have a 31-day extension of Federal Employees Health Benefits (FEHB) coverage in which he or she can choose to move to an individual contract or continue under FEHB coverage via Temporary Continuation of Coverage (TCC) provisions which lasts for up to 36 months.
2. How Can A Federal Employee Remove An Ex-Spouse From Their Health Insurance?
Many federal employees make it a priority to remove their former spouse from their health insurance early in the divorce process. To accomplish this, the federal employee will need to complete the proper forms. They will be required to complete form SF 2809 to change the enrollment from Self and Family, to Self Only to remove an ex-spouse. Also, the Human Resources Office must be notified of the divorce. If a federal employee elects to maintain their Self and Family Coverage, they should advise HR of the date of the divorce to ensure that the ex-spouse is promptly removed from enrollment a that time.
3. How Are FERS Benefits Divided During A Divorce?
Federal employees are often concerned that their ex-spouse will receive a large portion of their Federal Employee Retirement System (FERS) pension. These employees have the opportunity to discuss or negotiate the division of the federal benefits with their former spouses during the divorce process. Forms TSPBK11 (Court Orders and Powers of Attorney for TSP) and RI 84-1 (Court Ordered Benefits for Former Spouses) should be used as guidelines for this process.
Under the Federal Employees Retirement System, the maximum amount that an ex-spouse can receive is 50 percent. The benefit payable to a current spouse equals the difference between the maximum benefit payable and the court-ordered benefit for an ex-spouse.
4. How Is A TSP Divided During A Divorce?
A Thrift Savings Plan (TSP) is a retirement savings plan available to federal employees. In a divorce, a TSP can be divided in two main ways: a Retirement Benefits Court Order (RBCO), such as a legal separation, annulment or decree of divorce, or a property settlement contract that has been approved by the court and is incident to the decree.
The court can issue an order to freeze the TSP account until the divorce has been finalized, meaning that no loans or withdrawals can be made during that time. A separate court order will be required to send the former spouse the amount awarded in the divorce decree. TSP accounts can also be garnished for outstanding child support or spousal support.
5. What Happens If A Federal Employee Remarries?
If a federal employee remarries, they may want to cover their new spouse with their federal benefits. A divorced federal employee, whether retired or still employed, has the right to add a new spouse to their FEHB plan if they remarry. Coverage begins on the date of the marriage if used as a qualifying life event or during any open enrollment period.
The new spouse may also be eligible for a spousal survivor benefit if the federal employee had a minimum of 18 months of federal service under FERS or five-plus years of federal service under CSRS. A surviving spouse would be eligible for these benefits if the employee passes away after nine months of marriage, passes within nine months of marriage and the death was accidental, or if the employee passes within nine months of marriage and the surviving spouse has a child with the employee.
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Managing the divorce process can be more complex when federal benefits are involved. It becomes even more complicated when dealing with issues such as child custody, spousal support and income tax considerations.
One of the first steps federal employees and their spouses should take when starting the divorce process, is to contact a reputable attorney with experience navigating federal employee benefits. To learn more about the federal employee divorce process, or to speak with a knowledgeable divorce attorney about federal employee divorce rights, contact the legal team at Milstein Siegel today.
