Splitting a Pension in a Divorce? Federal Workers Face Unique Hurdles in Court

aaron steele
September 5, 2025

Key Takeaways

Federal pensions are marital property and can be divided in divorce, but only under specific rules governed by federal law.
Court orders must follow exact wording and format to be accepted by OPM, and delays or errors can result in lost benefits.

Understanding Your Federal Pension in Divorce

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or retiree, your pension becomes part of the financial negotiation. The Office of Personnel Management (OPM) treats federal retirement benefits as marital property, meaning your ex-spouse may be entitled to a share. But dividing a Civil Service Retirement System (CSRS) or Federal Employees Retirement System (FERS) annuity isn’t as simple as splitting a 401(k). Federal rules override state laws in many key areas, creating hurdles that are unique to government employees.

What the Court Can and Cannot Do

Dividing a federal pension in divorce requires a court-issued Court Order Acceptable for Processing (COAP). This is different from a standard divorce decree. It must be approved by OPM and adhere to their strict criteria:

The order must clearly state how the benefit is to be divided.
It must not award more than what the employee is entitled to.
It must not conflict with federal law or OPM regulations.

Importantly, the court cannot force the federal government to pay out benefits not authorized by statute. For instance, lifetime survivor benefits cannot be ordered without specific elections made before or at retirement.

Which Retirement System Are You Under?

Your retirement system affects how your pension may be split:

CSRS

Covers fewer employees today but provides higher annuity payouts.
No Social Security component, so no Social Security offset in divorce.
Survivor benefit rules must be explicitly detailed in the COAP.

FERS

Covers the majority of current federal employees.
Includes a basic annuity, Social Security, and Thrift Savings Plan (tsp).
Court can divide the annuity, order shared benefits from TSP, and address Social Security separately.

Common Legal Pitfalls That Hurt Your Settlement

1. Vague Language in the Court Order

OPM requires precision. Saying “50% of the retirement” is not enough. You must specify the formula, dates of service, or exact amounts. Errors here can delay processing for months or result in the order being rejected.

2. Forgetting to Address Survivor Benefits

A former spouse only receives survivor benefits if the retiree:

Elects a survivor annuity at retirement,
The COAP orders it, and
The election is made within two years of the divorce.

Without all three, your ex-spouse could get nothing after your death, regardless of prior verbal or court agreements.

3. Mishandling TSP Division

The TSP is not automatically divided. It requires a Retirement Benefits Court Order (RBCO), separate from the COAP, to assign shares. TSP cannot process orders that award specific funds or investment types; only percentages or fixed dollar amounts are accepted.

Survivor Annuity Elections: What You Must Know

If your divorce includes an agreement or order for your former spouse to receive survivor benefits, you must act quickly and correctly:

A full survivor annuity is 50% of your basic annuity; a partial is less than that.
Your annuity will be permanently reduced to fund the survivor benefit.
If you remarry, your new spouse may also be eligible — unless your previous survivor election is still in effect.

In 2025, OPM processes elections based on the earliest valid submission. Once a former spouse has a court-ordered survivor annuity, your options for changing it later are limited unless they waive their rights.

Time Limits and Processing Delays

Delays in submitting a court order can result in:

Retroactive payments being denied.
Survivor benefit elections becoming invalid.
The annuitant dying before the order is accepted, leaving the former spouse with no benefits.

The timeline is strict: OPM must receive the COAP before the retiree dies and within two years of the divorce if survivor benefits are involved.

What About Social Security?

Social Security benefits are not divisible by court order like pensions or TSP accounts. However, an ex-spouse may qualify for Social Security benefits based on your record if the marriage lasted at least 10 years and they are 62 or older and unmarried.

This doesn’t reduce your Social Security and doesn’t require your consent.

FERS Annuity Supplement: Special Considerations

If you retire before age 62 and qualify for the FERS Supplement, it may or may not be included in a divorce award depending on the court’s interpretation. OPM does not specifically address the supplement in its COAP processing guidance, so legal counsel must clarify this point.

Because this benefit ends at age 62 and is not paid by Social Security, a COAP must specify if and how it should be divided.

Military Buyback Time Can Complicate Things

If you purchased military service credit to boost your FERS or CSRS retirement, this time is generally included in any pension division. However, courts sometimes overlook it. You need to clarify whether the added service credit is part of the marital portion or not.

This matters greatly in community property states where all contributions during marriage are split.

Reemployment After Divorce: Impacts on Pensions

If you return to federal service after a divorce, your future benefits may be recalculated. OPM can honor COAP terms only for the period of service covered at the time of divorce unless updated orders are submitted.

This also affects any survivor annuity elections made under the old service. You’ll likely need to reaffirm or re-elect them.

Can You Change a COAP Later?

Yes, but only through court modification and submission of a revised order to OPM. This means both parties typically must agree or re-litigate. Changes are not retroactive unless the original order allows it.

And remember: OPM enforces only what the court order says, not what you think it meant or what state laws might assume. If the language isn’t in the document, OPM won’t act on it.

Working with Legal Professionals Familiar with Federal Retirement

Dividing a federal pension is not routine work for most divorce attorneys. Be sure to choose someone who understands:

CSRS and FERS nuances
COAP and RBCO requirements
OPM approval standards

Mistakes by your legal team can result in irreversible loss of benefits.

You should also consider working with a financial planner experienced in federal benefits to understand how splitting your annuity, electing a survivor benefit, or dividing your TSP will affect your long-term income.

The Path Forward After Divorce

To protect your benefits and those of your former spouse, here are your action steps:

Get a COAP and RBCO drafted by experts in federal retirement.
File the paperwork with OPM quickly.
Make any required elections (like a survivor benefit) within two years.
Stay informed about how remarriage or reemployment may impact existing court orders.
Review your retirement plan periodically to confirm it reflects current legal obligations.

Protecting Your Retirement Requires More Than Just a Divorce Decree

Dividing a federal pension during divorce is complex, governed by strict OPM rules and federal law. Missing key deadlines or filing an improperly worded COAP can cause lifelong financial consequences. Whether you’re in CSRS, FERS, or somewhere in between, don’t leave your future income to chance.

Get in touch with a licensed professional listed on this website who understands the unique challenges facing federal employees in divorce. They can help you avoid missteps and protect what you’ve earned.

Aaron Steele

After entering the financial services industry in 1994, it was a desire to guide people towards their financial independence that drove Aaron to start Steele Capital Management in 2013. Armed with an extensive background in financial planning and commercial banking coupled with a sincere passion for helping people, Aaron has the expertise and affinity for serving the unique needs of those in transition. Clients benefit from his objective financial solutions and education aligned solely with
helping them pursue the most comfortable financial life possible.

Born in Olympia, Washington, Aaron spent much of his childhood in Denver, Colorado. An area outside of Phoenix, Arizona, known as the East Valley, occupies a special place in Aaron’s heart. It is where he graduated from Arizona State University with a Bachelor of Science degree in Business Administration, started a family, and advanced his professional career.

Having now returned to his hometown of Olympia, and with the days of coaching his sons football and baseball teams behind him, he now has time to pursue his civic passions. Aaron is proud to serve on the Board of Regents Leadership for Thurston County as the Secretary and Treasurer for the Morningside area. His past affiliations include the West Olympia Rotary and has served on various committees for organizations throughout his community.

Aaron and his beautiful wife, Holly, a Registered Nurse, consider their greatest accomplishment having raised Thomas and Tate, their two intelligent and motivated sons. Their oldest son Tate is following in his father’s entrepreneurial footsteps and currently attends the Carson College of Business at Washington State University. Their beloved youngest son, Thomas, is a student at Olympia High School.

Focused on helping veterans and their families navigate the maze of long-term care solutions, Aaron specializes in customized strategies to avoid the financial crisis that care related expenses can create. Experience has shown him that many seniors are not prepared for the economic transition that takes place as they reach an advanced age.

With support from the American Academy of Benefit Planners – an organization with expertise and resources on the intricacies of government benefits – he helps clients close the gap between the cost of care and their income while protecting their assets from depletion.

Aaron can help you and your family to create, preserve and protect your legacy.

That’s making a difference.

Disclosure: Investment advisory services are offered through BWM Advisory, LLC (BWM). BWM is registered as an Investment Advisor located in Scottsdale, Arizona, and only conducts business in states where it is properly licensed, notice has been filed, or is excluded from notice filing requirements. This information is not a complete analysis of the topic(s) discussed, is general in nature, and is not personalized investment advice. Nothing in this article is intended to be investment advice. There are risks involved with investing which may include (but are not limited to) market fluctuations and possible loss of principal value. Carefully consider the risks and possible consequences involved prior to making any investment decision. You should consult a professional tax or investment advisor regarding tax and investment implications before taking any investment actions or implementing any investment strategies.