CSRS or FERS Survivor Annuity: Federal Employee Retirement Taxes (2025 IRS Guide)
This guide covers “CSRS or FERS Survivor Annuity” within federal employee retirement taxes. The following material presents the IRS treatment of this topic, including the qualifications, exceptions, and examples in the source section. Read the rules alongside the facts of your own situation before deciding what to report, deduct, or document.
Adapted from Publication 721 (2025), Tax Guide to U.S. Civil Service Retirement Benefits, published by the Internal Revenue Service. This guide retains the source edition’s years, amounts, deadlines, and examples. It is guidance for that edition, not a statement that the same figures apply to every tax year.
Context for these rules
This part of the publication is for survivors of federal employees. It explains how to treat amounts you receive because of the employee’s death. If you are the survivor of a federal retiree, see Part V, later.
CSRS or FERS Survivor Annuity
If you receive a CSRS or FERS survivor annuity, you can recover the employee’s cost tax free. The employee’s cost is the total of the retirement plan contributions that were taken out of their pay.
How you figure the tax-free recovery of the cost depends on your annuity starting date. This is the day after the date of the employee’s death. The methods to use are the same as those described under Recovering your cost tax free near the beginning of Part II, earlier.
The following discussions cover only the Simplified Method. You can use this method if your annuity starting date is after July 1, 1986. You must use this method if your annuity starting date is after November 18, 1996. Under the Simplified Method, each of your monthly annuity payments is made up of two parts: the tax-free part that is a return of the employee’s cost and the taxable part that is the amount of each payment that is more than the part that represents the employee’s cost. The tax-free part remains the same, even if your annuity is increased. However, see Exclusion limit, later.
Surviving spouse with no children receiving annuities.
Under the Simplified Method, you figure the tax-free part of each full monthly annuity payment by dividing the employee’s cost by a number of months based on your age. This number will differ depending on whether your annuity starting date is before November 19, 1996, or after November 18, 1996. To use the Simplified Method, complete Worksheet A. Specific instructions for Worksheet A are given under Simplified Method in Part II, earlier.
Example.
Diane Green, age 48, began receiving a $1,500 monthly CSRS annuity in March 2025 upon the death of her husband. Her husband was a federal employee when he died. She received 10 payments in 2025. Her husband had contributed $36,000 to the retirement plan.
Diane must use the Simplified Method. Her completed Worksheet A is shown later. To complete line 3, she used Table 1 at the bottom of the worksheet and found that 360 is the number in the last column opposite the age range that includes her age. Diane keeps a copy of the completed worksheet for her records. It will help her figure her taxable annuity in later years.
Worksheet A. Simplified Method for Diane Green
See the instructions under Simplified Method in Part II of this publication.
| 1. | Enter the total pension or annuity payments received this year. Also, add this amount to the total for Form 1040, 1040-SR, or 1040-NR, line 5a | 1. | $ 15,000 | |||
| 2. | Enter your cost in the plan at the annuity starting date, plus any death benefit exclusion.* See Your cost under Rules for Retirees in Part II, earlier | 2. | 36,000 | |||
| Note: If your annuity starting date was before this year and you completed this worksheet last year, skip line 3 and enter the amount from line 4 of last year’s worksheet on line 4 below (even if the amount of your pension or annuity has changed). Otherwise, go to line 3. | ||||||
| 3. | Enter the appropriate number from Table 1 below. But if your annuity starting date was after 1997 and the payments are for your life and that of your beneficiary, enter the appropriate number from Table 2 below | 3. | 360 | |||
| 4. | Divide line 2 by the number on line 3 | 4. | 100 | |||
| 5. | Multiply line 4 by the number of months for which this year’s payments were made. If your annuity starting date was before 1987, enter this amount on line 8 below and skip lines 6, 7, 10, and 11. Otherwise, go to line 6 | 5. | 1,000 | |||
| 6. | Enter any amounts previously recovered tax free in years after 1986. This is the amount shown on line 10 of your worksheet for last year | 6. | 0 | |||
| 7. | Subtract line 6 from line 2 | 7. | 36,000 | |||
| 8. | Enter the smaller of line 5 or line 7 | 8. | 1,000 | |||
| 9. | Taxable amount for year. Subtract line 8 from line 1. Enter the result, but not less than zero. Also, add this amount to the total for Form 1040 or 1040-SR, line 5b. If you are a nonresident alien, enter this amount on line 1 of Worksheet C. If your Form CSA 1099-R or Form CSF 1099-R shows a larger amount, use the amount figured on this line instead. If you are a retired public safety officer, see Distributions Used To Pay Insurance Premiums for Public Safety Officers under Part II before entering an amount on your tax return or Worksheet C, line 1 | 9. | $ 14,000 | |||
| 10. | Was your annuity starting date before 1987? Worksheet checkbox Yes. stopDon’t complete the rest of this worksheet. worksheet checkbox No. Add lines 6 and 8. This is the amount you have recovered tax free through 2025. You will need this number if you need to fill out this worksheet next year | 10. | 1,000 | |||
| 11. | Balance of cost to be recovered. Subtract line 10 from line 2. If zero, you will not have to complete this worksheet next year. The payments you receive next year will generally be fully taxable | 11. | $ 35,000 | |||
| Table 1 for Line 3 Above | ||||||
| IF your age on your annuity starting date was... | AND your annuity starting date was— | |||||
| before November 19, 1996, THEN enter on line 3... | after November 18, 1996, THEN enter on line 3... | |||||
| 55 or under | 300 | 360 | ||||
| 56–60 | 260 | 310 | ||||
| 61–65 | 240 | 260 | ||||
| 66–70 | 170 | 210 | ||||
| 71 or over | 120 | 160 | ||||
| Table 2 for Line 3 Above | ||||||
| IF the annuitants’ combined ages on your annuity starting date were... | THEN enter on line 3... | |||||
| 110 or under | 410 | |||||
| 111–120 | 360 | |||||
| 121–130 | 310 | |||||
| 131–140 | 260 | |||||
| 141 or over | 210 | |||||
* A death benefit exclusion of up to $5,000 applies to certain benefits received by survivors of employees who died before August 21, 1996.
Diane’s tax-free monthly amount is $100 (line 4 of her worksheet). If she lives to collect more than 360 payments, the payments after the 360th will be fully taxable. If she dies before 360 payments have been made, an “Other Itemized Deduction” will be allowed for the unrecovered cost on her final income tax return.
Surviving spouse with child.
If the survivor benefits include both a life annuity for the surviving spouse and one or more temporary annuities for the employee’s children, an additional step is needed under the Simplified Method to allocate the monthly exclusion among the beneficiaries correctly.
Figure the total monthly exclusion for all beneficiaries by completing lines 2 through 4 of Worksheet A as if only the surviving spouse received an annuity. Then, to figure the monthly exclusion for each beneficiary, multiply line 4 of the worksheet by a fraction. For any beneficiary, the numerator of the fraction is that beneficiary’s monthly annuity, and the denominator is the total of the monthly annuity payments to all the beneficiaries.
The temporary annuity is payable to the child until the child reaches a specified age in the plan, which can’t be older than 25. The ending of a child’s temporary annuity doesn’t affect the total monthly exclusion figured under the Simplified Method. The total exclusion merely needs to be reallocated at that time among the remaining beneficiaries. If only the surviving spouse is left drawing an annuity, the surviving spouse is entitled to the entire monthly exclusion as figured in the worksheet.
Example.
The facts are the same as in the example for Diane Green in the preceding discussion, except that the Greens had a son, Robert, who was age 15 at the time of his father’s death. Robert is entitled to a $500-per-month temporary annuity until he reaches age 18 (age 22, if he remains a full-time student and doesn’t marry), as specified by the plan.
In completing Worksheet A (not shown), Diane fills out the entries through line 4 exactly as shown in the filled-in worksheet for the earlier example. That is, she includes on line 1 only the amount of the annuity she herself received and she uses on line 3 the 360 factor for her age. After arriving at the $100 monthly exclusion on line 4, however, Diane allocates it between her own annuity and that of her son.
To find how much of the monthly exclusion to allocate to her own annuity, Diane multiplies the $100 monthly exclusion by the fraction $1,500 (her monthly annuity) over $2,000 (the total of her $1,500 and Robert’s $500 annuities). She enters the result, $75, just below the entry space for line 4. She completes the worksheet by entering $750 on lines 5 and 8, and $14,250 on line 9.
A second Worksheet A (not shown) is completed for Robert’s annuity. On line 1, he enters $5,000 as the total annuity received. Lines 2, 3, and 4 are the same as those on his mother’s worksheet. In allocating the $100 monthly exclusion on line 4 to his annuity, Robert multiplies it by the fraction $500 over $2,000. His resulting monthly exclusion is $25. His exclusion for the year (line 8) is $250, and his taxable annuity for the year (line 9) is $4,750.
Diane and Robert only need to complete lines 10 and 11 on a single worksheet to keep track of their unrecovered cost for next year. These lines are exactly as shown in the filled-in Worksheet A for the earlier example.
When Robert’s temporary annuity ends, the computation of the total monthly exclusion will not change. The only difference will be that Diane will then claim the full exclusion against her annuity alone.
Surviving child only.
A method similar to the Simplified Method can also be used to figure the taxable and nontaxable parts of a temporary annuity for a surviving child when there is no surviving spouse annuity. To use this method, divide the deceased employee’s cost by the number of months from the child’s annuity starting date until the date the child will reach age 22. The result is the monthly exclusion. (However, the monthly exclusion can’t be more than the monthly annuity payment. You can carry over unused exclusion amounts to apply against future annuity payments.)
More than one child.
If there is more than one child entitled to a temporary annuity (and no surviving spouse annuity), divide the cost by the number of months of payments until the date the youngest child will reach age 22. This monthly exclusion must then be allocated among the children in proportion to their monthly annuity payments, like the exclusion shown in the previous example.
Disabled child.
If a child otherwise entitled to a temporary annuity was permanently disabled at the annuity starting date (and there is no surviving spouse annuity), that child is treated for tax purposes as receiving a lifetime annuity, like a surviving spouse. The child must complete line 3 of Worksheet A using a number in Table 1 at the bottom of the worksheet corresponding to the child’s age at the annuity starting date. If more than one child is entitled to a temporary annuity, an allocation like the one shown under Surviving spouse with child, earlier, must be made to determine each child’s share of the exclusion.
Exclusion limit.
If your annuity starting date is after 1986, the most that can be recovered tax free is the cost of the annuity. Once the total of your exclusions equals the cost, your entire annuity is taxable. If your annuity starting date is before 1987, the tax-free part of each whole monthly payment remains the same each year you receive payments—even if you outlive the number of months used on line 3 of the Simplified Method Worksheet. The total exclusion may be more than the cost of the annuity.
Deduction of unrecovered cost.
If the annuity starting date is after July 1, 1986, and the annuitant’s death occurs before all the cost is recovered tax free, the unrecovered cost can be claimed as an “Other Itemized Deduction” for the annuitant’s last tax year.
Survivors of Slain Public Safety Officers
Generally, if you receive survivor annuity payments as the spouse, former spouse, or child of a public safety officer killed in the line of duty, you can exclude the payments from your income. The annuity is excludable to the extent that it is due to the officer’s service as a public safety officer. Public safety officers include law enforcement officers, firefighters, chaplains, ambulance crew members, and rescue squad members. The provision applies to a chaplain killed in the line of duty after September 10, 2001. The chaplain must have been responding to a fire, rescue, or police emergency as a member or employee of a fire or police department.
The exclusion doesn’t apply if your actions were a substantial contributing factor to the death of the officer. It also doesn’t apply if:
The death was caused by the intentional misconduct of the officer or by the officer’s intention to cause their own death,
The officer was voluntarily intoxicated at the time of death, or
The officer was performing their duties in a grossly negligent manner at the time of death.
.The special death benefit paid to the spouse of a FERS employee (see FERS Death Benefit, earlier) isn’t eligible for this exclusion. .
Using the guidance
Keep the documents that establish the dates, amounts, and circumstances described above. References to other chapters, forms, worksheets, or earlier and later sections refer to the linked IRS publication. Check the full publication and its updates before relying on a rule for a different tax year or a situation not addressed here.
Sources and further reading
- Publication 721 (2025), Tax Guide to U.S. Civil Service Retirement Benefits: Rules for Survivors of Federal Employees — CSRS or FERS Survivor Annuity — Internal Revenue Service; 2025 edition.
The cited U.S. government text is in the public domain. Source accessed October 28, 2026. Fynoptic has organized this material for educational use and is independent of, and not endorsed by, the IRS.