What to do when a FRS account holder dies

FRS requires a certified copy of the death certificate and the completed claim package. Depending on the benefit, additional documents may include a marriage certificate or other proof of relationship for a surviving spouse or joint annuitant, Letters of Administration or Letters Testamentary if the estate is the beneficiary, and a certification or copy of the trust if a trust is the beneficiary.

At retirement a Pension Plan member selects one of four options on the Option Selection form (FRS-11o). Option 1 pays the highest monthly benefit for the member's lifetime, and at death it stops; the beneficiary receives only a refund of any contributions the member paid that exceed the benefits already received. Option 2 pays a reduced benefit for life, and if the member dies within 120 months (10 years) of retirement, the beneficiary receives the same monthly amount for the remainder of that period. Option 3 pays a reduced benefit and continues the same monthly amount to a joint annuitant for life. Option 4 pays an adjusted benefit while both are living and reduces to two-thirds for the survivor when either dies.

If an active member dies in the line of duty, the surviving spouse receives a monthly benefit for life regardless of the member's length of service, equal to 50 percent of the member's last monthly salary, or 100 percent for members in the Special Risk Class. If there is no surviving spouse or the spouse dies, unmarried children may receive benefits until age 18, or until age 25 if a full-time student. This benefit is set by law and is separate from the regular survivor and beneficiary rules.

The FRS Investment Plan is a defined-contribution account. When a vested member dies before taking a distribution, the full value of the vested account balance is paid to the named beneficiary. A non-vested member's beneficiary receives the contributions payable under the plan. A spouse beneficiary can defer the account or choose among distribution options; a non-spouse beneficiary generally must decide within one year. The account can be paid as a rollover, a lump sum, periodic distributions, or an annuity.

For a Pension Plan member who dies before retiring other than in the line of duty, a beneficiary who is not a joint annuitant generally receives a refund of the member's personal contributions. A beneficiary who qualifies as a joint annuitant may instead choose a refund, a lifetime monthly benefit calculated as if the member had retired on the date of death, or a deferred benefit; early-retirement reductions may apply. For an Investment Plan member, the vested account balance passes to the named beneficiary.

A trust or estate can be named to receive lump-sum amounts, such as a refund of member contributions under the Pension Plan or the vested balance of an FRS Investment Plan account. FRS requires a certification or copy of the trust when a trust is the beneficiary, and Letters of Administration or Letters Testamentary when the estate is involved. Continuing monthly survivor benefits under Pension Plan Options 3 and 4 and the in-line-of-duty benefit, however, are paid only to eligible individuals under FRS rules and cannot be redirected to a trust.