Bailey Settlement When Buying Military Time Into Civil Service Time

[surfdog]

I started working as a federal employee (FERS) in Nov 1987. I also had with 4 years of active military duty (1976-1980). I was able to buy in those four military years towards my FERS retirement. As a result my civil service retirement computation date was changed  Nov 1983. 

Under these circumstances, does  my federal retirement income qualify for the "Bailey Exemption" on the NC State tax return since buying my military time gives me more than 5 years of creditable service prior to 12 August 1989?

Thanks

[ReneeM7122 · Accepted solution]

Yes, as long as you had 5 years of service credited before August 12, of 1989, then you would qualify for the Bailey Exemption.

Source:

According to the North Carolina Department of Revenue,  The exclusion applies to retirement benefits received from certain defined benefit plans, such as the North Carolina Teachers' and State Employees' Retirement System, the North Carolina Local Governmental Employees' Retirement System, the North Carolina Consolidated Judicial Retirement System, the Federal Employees' Retirement System, or the United States Civil Service Retirement System, if the retiree had five or more years of creditable service as of August 12, 1989.