dmertz
Level 15

Deductions & credits

Amounts contributed to your FERS credit are not deductible on your tax return.  They are also not contributions that would contribute to your qualification for the Retirement Savings Contributions Credit, so they appear nowhere on your W-2 or on your tax return.

 

During payout, a portion of each of your FERS distributions will be a non-taxable return of your original investment in the plan, so you won't be paying taxes twice on this money.