For federal employees, some key financial numbers will go up in 2014, some will stay the same, and at least one may go down.
The budget bill that ended the partial government shutdown last month leaves room for what would be the first increase in basic salary rates after a three-year freeze. Some employees have had their pay frozen that entire time while some have received raises for performance, promotion or on advancing up the steps of a pay grade. Employees have in sight — but not yet in hand — a 1 percent across-the-board raise effective with the first full pay period of the new year.
President Obama already has indicated his intent to pay a 1 percent raise if no law is enacted by the end of the calendar year to specify a raise. While Congress could yet set a different number, including zero, the temporary funding measure extends beyond that deadline, into mid-January.
Separately, most retiree annuities will increase by 1.5 percent in January due to a cost-of-living adjustment separate from the raise-setting process. That COLA will go to the large majority of federal retirees — some are not eligible until they reach age 62 — as well as to beneficiaries under Social Security and some other federal programs.
About nine-tenths of active federal employees are under a retirement system that includes Social Security taxes and benefits. For them, the Social Security payroll tax of 6.2 percent will be taken from pay up to $117,000, up from $113,700 this year. There is no limit on the separate 1.45 percent of salary Medicare deduction.
Both active and retired employees generally are eligible for coverage under the Federal Employees Health Benefits Program, where the enrollee share of premiums is rising by about 4 percent on average for 2014. There is wide variation within that average, though, and in an open season running through Dec. 9, enrollees can change plans or levels of coverage within plans, for those offering more than one.
Two figures of importance to employees who invest in the Thrift Savings Plan will remain the same, the TSP has said. The maximum amount of regular investments in the TSP and other 401(k)-style retirement savings programs will continue to be $17,500. The limit on additional “catch-up” investments for those who are age 50 or above during the year also is unchanged, at $5,500.
One number that may go down is the “public transit subsidy” that many agencies pay to employees in the form of cash or transit passes for them to use public transportation in their commuting. The maximum tax-free amount, currently $245 a month, will drop to $130 unless Congress extends a temporary law to keep it at the higher level, according to the National Treasury Employees Union.
A separate subsidy of $245 a month for parking at transit stations meanwhile is set to rise to $250, the union said.
“NTEU believes that parity in these two elements of the transit subject is a matter of fairness and considerable importance to the many federal employees who rely on public transportation to and from work,” NTEU president Colleen M. Kelley said in an e-mailed statement.
A pending House bill would set both figures at $220, while a pending Senate bill would boost the transit subsidy up to the level of the parking subsidy.
