Service Credit
What your sick leave and military time are worth when you retire
Skip ahead: military buyback calculator
Unused Sick Leave
Unused sick leave isn't lost at retirement, and for NATCA BUEs it's a choice: convert the hours into extra creditable service, or cash out 40% of their value with the buy-back. This page prices both paths.
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Enter your unused sick-leave hours to see what they're worth as pension credit or cash.
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Both figures are estimates. The credit uses the OPM 2,087-hour rule, and whether leftover days drop depends on your full service computation. Confirm your numbers with OPM, FAA payroll, and HR.
The buy-back election
Under Article 25 §17 of the NATCA contract, retiring on an immediate annuity lets you elect a lump sum worth 40% of your balance's value instead of the pension credit. It's either/or, all or nothing.
Which should you take?
For most controllers the lump sum comes out ahead: the pension credit takes decades to catch up, and the lump sum is yours to invest or leave behind. What the pension credit offers instead is guaranteed, inflation-adjusted income for as long as you live.
OPM uses the 2,087-hour work year to convert your hours onto the 360-day OPM calendar (12 months × 30 days).
Rule of thumb: roughly 174 hours = 1 month of added service.
Once all your service time is combined, any leftover days that don't complete a full month are discarded. A total of 25 years, 8 months, 17 days drops those 17 days: only whole years and months feed the multiplier.
The credit and the buy-back both require an immediate annuity. In the uncommon case that you resign before you're eligible and claim a deferred retirement later, your sick-leave balance is worth nothing either way.
Military Buyback
If you served in the military before (or between periods of) your federal career, you can "buy back" that time with a deposit of 3% of your military basic pay. Pay it in full before you separate, and those years join your total creditable service.
Estimate your deposit (with interest after the grace period), the pension boost it buys, and the years to break even:
Enter your military service, average basic pay, and High-3 salary to estimate the buyback.
Usually one of the best deals in federal service. For most veterans the deposit pays for itself within the first year or two of retirement, then keeps paying for the rest of your life.
The table tracks your cumulative gain at a few checkpoints, comparing the deposit (with interest) against the pre-tax pension increase.
| Year | Pension Gained | Net Gain | Status |
|---|
Each bought-back year is always credited at 1.0% of your High-3. Pension figures are pre-tax, and the deposit is paid with after-tax dollars, so the real breakeven lands a bit later than the table shows. Interest here assumes the 2026 rate (4.25%) for every year, but OPM applies each year's published rate. Your official deposit and interest are computed by OPM/payroll from your military earnings record.
1. Pay before you separate. The deposit must be paid in full first: retire or resign before it clears and the option is gone for good. Processing can take months, so start early.
2. Waive military retired pay. You generally must waive your military retired pay to get FERS credit for the same years (no double-dipping). Exceptions you don't have to waive: retired pay for a combat-incurred disability (or one caused by an instrumentality of war), and pay under a Chapter 1223 reserve (non-regular) retirement. Confirm your situation with HR.
An ATC with 22 years of ATC service who buys back 4 years of military time, for 26 total years:
- First 20 years (of the 26) at 1.7% = 34%
- Remaining 6 years at 1.0% = 6%
- Total multiplier: 40%
Without the buyback, 22 years → (1.7% × 20) + (1.0% × 2) = 36%. The 4 bought-back years add 4 points because total service is already past 20: every year beyond the first 20 is worth 1.0%.
No interest accrues for the first 2 years after your FERS coverage begins (the date you were first subject to FERS deductions). Interest posts only once a year, so you can pay interest-free until close to the third anniversary. Pay in that window and you owe only the base deposit. After that, interest compounds annually at a variable Treasury rate (4.25% for 2026), and waiting gets more expensive each year.
"Catch-62" is the CSRS rule where unpaid post-1956 military time is recaptured (stripped out of the annuity) once you turn 62 and become eligible for Social Security. That rule does not exist under FERS. Under FERS, post-1956 military service is creditable only if you pay the deposit: no age-62 trap, but no fallback either. No deposit means the time is never counted, at any age. (5 U.S.C. § 8411(c).)
"Good time" vs. the computation
Eligibility to retire early takes 20 years of actual ATC service once you reach age 50, or 25 years at any age. That service is your "good time," set by § 8412(e), and neither sick leave nor bought-back military time can ever count toward it.
Both credits do count in your annuity computation. Under § 8415(e) your first 20 years of total service earn 1.7%; every year past 20 earns 1.0%. A full ATC career already fills that first-20 band with ATC time, so sick leave and bought-back military time stack on top at 1.0%. Not the enhanced rate, but real money every year for life. Sick leave counts here only if you keep the credit rather than take the buy-back.