Thanks!
Here is the guidance I am reading from FERS, OPM, and DFAS (which I believe is the ultimate decision-maker):
Military Retirees (FERS Credible Military Service)
Generally, if you receive military retired pay based on a retirement from active duty military service, you may not receive credit for military service under CSRS or FERS unless you waive your military retired pay. If you waive military retired pay, you waive just your monthly check. You do not waive military survivor benefits, health coverage, or other benefits provided by the military. If you are receiving VA benefits in lieu of all or part of your military retired pay, you may keep the VA benefits even if you waive military retired pay for CSRS or FERS purposes.
If your military retired pay is based on a combat-connected disability (or caused by an instrumentality of war during a period of war), or you are retiring from the reserves, you may continue to receive your disability or reserve retired pay and still have your active duty military service credited under CSRS or FERS. If you decide to waive your military retired pay to combine your civilian and military service, you must submit a waiver request to the military finance center at least 60 days before you retire. Military service credited upon waiving military retired pay is subject to the rules for post-1956 military deposits.
OPM Guide HR Professionals
For retirement:
An employee must waive military retired pay to receive any credit for military service unless the retired pay is awarded based on a service-connected disability incurred in combat with an enemy of the United States or caused by an instrumentality of war and incurred in the line of duty during a period of war as defined by 38 U.S.C. 301, or awarded under 10 U.S.C. chapter 1223 (previously chapter 67).
5 U.S.C. 6303, 8332 and 8411(c); and the CSRS and FERS Handbook
DFAS Guidance (Oct 2024)
Waving Military Retirement - Most military retirees cannot receive credit for federal civil service purposes unless they waive their military retired pay.
Exceptions include:
- Due to a service-connected disability either incurred in combat with an enemy of the United States or caused by an instrumentality of war and incurred in the line of duty during a period of war, or
- Under the provisions of Chapter 1223, Title 10, U.S.C. (pertaining to retirement from a reserve component of the Armed Forces).