Capitalize the names of countries and international organizations as well as national, state, county, and city bodies and their subdivisions. Do not capitalize generic terms.
Capitalize short forms of names and national and international bodies and their major divisions
As a rule, do not capitalize short forms of state or local government groups except when special circumstances warrant emphasis or distinction.
Common terms such as police department, board of education, and county court need not be capitalized (even when referring to a specific body), since they are terms of general classification. However, such terms should be capitalized when the writer intends to refer to the organization in all of its official dignity.
Note: Don't capitalize the short form if it is not actually derived from the complete name. For example, do not capitalize the short form police department if the full name is Department of Public Safety
Capitalize federal only when it is part of the official name of a federal agency, a federal act, or some other proper noun.
The terms federal government and government (referring specifically to the United States government) are now commonly written in lowercase letters because they are considered terms of general classification. In government documents, however, and in other types of communications where these terms are intended to have the force of an official name, they are capitalized.
Capitalize the words union and commonwealth only when they refer to a specific government.
Source: The Gregg Reference Manual