MILITARY BUYBACK FOR FEDERAL EMPLOYEES

Quick answer: buying back military time means making a deposit — generally 3% of your military basic pay under the Federal Employees Retirement System (FERS) or 7% under the Civil Service Retirement System (CSRS), plus any accrued interest — so eligible active-duty service counts toward your federal civilian retirement. The estimate below uses the military basic pay you enter; your official deposit is calculated by your agency from earnings certified by DFAS or your branch’s finance center.

List each creditable active-duty service period and request certified estimated military earnings. Apply the general deposit percentage to military basic pay: 3% for FERS or 7% for CSRS, then keep each period separate while checking your records.

Interest can apply after the initial interest-free period, and military retired pay may require a waiver for civilian retirement credit, subject to limited exceptions. Request earnings with RI 20-97, submit SF 3108 or SF 2803 through agency HR, and rely on agency payroll for the official deposit.

Military buyback (a “military service credit deposit”) lets federal employees make a deposit so eligible active-duty service counts toward their civilian retirement under FERS or CSRS. Once complete, the bought-back years generally count toward both retirement eligibility and the annuity computation. If you receive military retired pay, crediting the service usually requires waiving that retired pay, with limited exceptions for certain disability and reserve retirements — an individual determination your agency and OPM make.

1. Request estimated earnings: send form RI 20-97 with your DD-214 to your branch’s military finance center (DFAS for most branches) to get your certified military basic pay.
2. Apply through your agency: submit SF 3108 (FERS) or SF 2803 (CSRS) with the certified earnings to your HR office.
3. Receive the official calculation: your agency payroll office computes the exact deposit, including any interest.
4. Pay before retirement: pay in a lump sum or installments (often payroll deduction). The deposit generally must be complete before you separate.

On interest timing, the general rule: deposits completed within the initial grace period (roughly the first two years of covered civilian service, with interest posting around the third anniversary) accrue no interest; afterward, interest is added annually at a variable rate. Your agency’s calculation is the only official figure.

Bought-back years combine with your civilian service, your unused sick leave credit, and your retirement timing to shape your annuity — our FERS/CSRS pension estimator explains how the annuity formula uses your total service. The Retirement Road Map helps you organize all of it before talking with your HR office or an independent, licensed professional.