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When your agency corrected your retirement coverage to FERS, it also should have contributed make-up agency contributions and lost earnings on those contributions to your TSP account.
If you now choose CSRS Offset, no adjustments will be made to your TSP account. Instead, OPM will find out how much of your TSP account is based on what your agency contributed (this includes the earnings on those contributions). That dollar amount will form the basis for an actuarial reduction in your CSRS Offset retirement benefit.
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