Hello - I understand that Federal Employee Retirement System (FERS) Further Revised Annuity Employees (FRAE). FERS FRAE employees have 4.4 percent deducted from their base pay to cover their share of the cost of a retirement benefit. But what I don't understand is why it is not tax deductible or pre-tax dollars? From a taxable income standpoint, why are FRAE contributions taxable while TSP contributions are not?
