5 CFR 839.1115
§ 839.1115 What is an actuarial reduction?
United States · 5 CFR — Administrative Personnel · Status: effective
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- Citation
- 5 CFR 839.1115, § 839.1115 What is an actuarial reduction?, United States, version 1 as recorded 2026-07-09, yourstate.us, https://yourstate.us/provision/8159
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Full text
An actuarial reduction allows you to receive benefits without having to pay an amount due in a lump sum. OPM reduces your annuity in a way that, on average, allows the Fund to recover the amount of the missing lump sum over your lifetime. The actuarial reduction becomes a permanent reduction in your benefit. The amount of the reduction depends on your age and the amount of the lump sum you would otherwise have to pay at that time. To compute an actuarial reduction, OPM divides the lump sum amount by the present value factor for your age at retirement.
Legislative history
This is a federal regulation, adopted through agency rulemaking under the Administrative Procedure Act — not enacted by a recorded vote of Congress.