Social Security Windfall Elimination WEP & GPO
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- Опубліковано 3 тра 2022
- Will your Social Security benefits be reduced by Windfall Elimination WEP & GPO provisions?
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This is so unfair. We paid social security and we should receive it and not be penalized. It not double dipping. Not only that a spouses should not be penalized either. And it time to fix it.
WEP is not a penalty. It prevents you from a windfall at the expense of the American taxpayer. Complain to your union.
did you pay into Social Security?
@@sumisell Of course. I support America.
tell it to those who still kneal at the altar of Ronnie R
Yes, so unfair. You want to get about 3 times higher replacement rate on your earning than normal folks; you're not satisfied with the 40% where normal folks only get 32%. And realize that you did not contribute to SS during those gmvt job years and could instead invest that money and do so much better. Or squander it.
I’m new with this channel. I’m very excited to learn more about this benefits. I’m going to be my 60 this year!! This channel is giving me so much information . Thank you!!!
Thank you for this video very helpful!!!
I had to pay 14% into my state teachers retirement. I also qualified for social security but will lose most of it to WEP. I will delay collecting til 70 since I get so little - it will barely cover my Medicare payments. I get no COLA for my very modest State teachers pension. As a teacher, I had a very modest income. SS will get a COLA this year - I will not - I have to wait for 5 years. If inflation continues as is, I will lose almost half of the buying power of an already modest pension. Also, I cannot collect any of my spouse’s social security due to GPO. How is any of this fair?
WEP and GPO protect the American taxpayer. Fair is fair.
@@eugeneahearn8299 Explain please. I have contributed to SS for over 40 years and will be penalized because I have a small pension. How is that fair?
These rules are determined by the government, don't look for fairness or reason. I'm self employed, I pay 100% into my retirement. Elections have consequences.
@@happycampers6592 Because you signed a statement on the first day of your 40 years that you acknowledge and understand WEP and GPO. Its YOUR signature. Define SMALL pension.
@@curtanschuetz3434 WEP and GPO are a specific calculation to make the field level.
Best explanation so far. Thank you. ❤
I will receive a government 403b account which did not pay FICA, and i also have a personal IRA. If I only withdraw from the IRA (and not the 403b), am I subject to WEP? Or, if I stop receiving 403b installments, and shift to the IRA, will I avoid the WEP during the stoppage?
I took SS at 62, had a small govt pension, also had SS. They adjusted the amount so that I didn’t get as much SS. My question is, do I still qualify for the spousal benefit when he retires?
Your spousal (and survivor) benefits are affected by your non-covered pension. The current adjustment was WEP, which simply moves your earning to a lower slope, bringing your replacement rate in-line with your real earnings.
This will sound a bit complicated. Because you claimed at 62, you got an almost 30% (25% if you are a bit older) reduction; that is forever! Spousal is composed of two parts, your benefit and a gross-up to 50% of spouses benefit. Remember you took early, so that part will not change. As you already filled, the gross-up will occur when spouse files. But that part is affected by GPO: 2/3 of yours is subtracted from his, so the relative values of these is the real answer, without actual numbers, it depends. If your pension is $750 and your PIA $500 and mate's (SS is gender neutral, but assumptions are problematic) SS is $2K, your spousal would be $2000/2 - $500 - $500 = ZERO.
On to the survivor benefit: your early filing disappears, the survivor would get the higher of the two benefits. But the GPO applies and again it depends. If your pension is $750 and your mate's SS is $2K survivor would be $1750.
My gut says you will likely not see spousal, but will see some spousal.
I worked for 23 years in a gov’t position where I PAID into SS. This job will provide a pension. I then took a new job where I do NOT pay into SS, and will likely work another 20 years AND I will get a gov’t pension from this second job. When I retire from job #2 and collect my SECOND gov’t pension, will I lose my SS because of WEP? I understand the idea that getting a gov’t pension AND SS is considered a “windfall” but since I paid into SS for 23 years - shouldn’t I still get something?
Yes, you will get something. WEP doesn't eliminate SS but it does reduce it.
@@FinancialFastLane thank you for the fast reply! I will definitely check out your website!
@@FinancialFastLane By a lot! Almost 60%.
Assuming your earned substantial earning for the 23 years, your WEP adjustment would be from 90% to 55%, the exact dollar amount depends on age/birthyear (see bend-points).
The non-covered pension is considered in lieu of SS and is at the bottom of your SS stack. WEP simply moves you to a different replacement rate as that pension is skipped over.
But remember you are not paying that 6%! Invest it and make way more than we normal folks that do not get that opportunity. Many of us would love to be able to do that!!!
Question. I'm thinking of taking SS at my full retirement age but continuing to work a few more years after that at my state government job that will pay me a separate pension when I fully retire. Since I won't be collecting that pension for a few years will WEP hit me up immediately or not until I start collecting that other pension?
WEP does not apply until the worker is entitled to both Social Security benefits and their non-covered pension.
@@FinancialFastLane Thank you for responding! It made sense to me that the reduction shouldn't apply until I take my pension from my current job. But it's the Federal government after all and thought I should look into it. I applied today for my SS benefits to start 1/1/2023. I will let you know how it turns out! Thanks again!
If you continue to work past full R, your benefit will continue to grow a little because you will still be contributing to SS tax from your income; however, the WEP depends on how much your first pension is. Social Security told me my pension of $660 will not affect my social security benefit amount of $1,300.
@@richbrake9910 - Your (anyone's) SS primary benefit only increases if you replace one of your high 35 years with a higher amount. If you had a Zero in your 35 years, another year will bump your benefit. But no number of lower part-time years will change the amount if one of the high 35 is not replaced. Any FICA then is just a gift to the SSA.
WEP changes the replacement rate in the first segment of the bend-points (two bend-points, therefore three segments) from 90% to 40% (less reduction if ...). So WEP only changes your benefit on about $1200 (number is indexed, so changes) of average earnings. Once you have hit 35 * $1.2K, you move to the next segment. But if you have a non-covered pension and less than 30 years of substantial SS earnings, you will absolutely have some adjustment.
I get small pension from working 7 years for county my spouse worked 35 years and paid SS and served during Vietnam he was drafted he passed away in January he paid in to SS that was his check w e p reduced it because I worked for county 7 years , sad the government will do this to a widow sad they did this to a veteran who was drafted made to go and served his country
So many folks do not know how it works and can't describe their situation. If HE was not a gmvt worker (military does not count) then WEP did not reduce his SS benefit. On the other hand, GPO would affect any spousal and now survivor benefit; I assume that is what you are discussing. Yes?
As a widow with a noncovered pension, you should receive that pension from the county AND an amount from SS that is his benefit less 2/3s of your pension. Your non-covered pension is in lieu of SS; consider what would have happened if you had that check from SS instead of the county: your survivor benefit would be the larger of the two SS benefits, but not BOTH. Are you receiving less than what normal folks get?
@@charleslemaire8137 yes receiving less only a few states still are doing this if l lived in Florida I would get his full benefits and my 400 dollar pension I was told that when I signed for his SS benefits by ss
I worked for the Federal Govt but I also worked in the private sector and receiving my 40 quarters. I do fall under WEP at present. My question is will I be able to receive my wife's SS if she passes before I do?
It will be adjusted by GPO. BTW, your SS is not a part of this. Note that normal two income families get a survivor benefit that is the larger of the two benefits, not both. Your gmvt pension is in lieu of SS; this is why the GPO adjusts your benefit to look like that of normal folks - you do not get both.
What if you a native from another country and had income there
If you still have that income, you will probably get penalized
SSA should already have that calculated in our statement what a shame
What a shame, the SSA is not all-knowing. They do not know what you make, because the state does not report it.
I am not looking for a hand out, I earned my social security benefits. I agree, it is not double. If I received what I should receive, I still would be living in poverty. Double dipping is a myth. Thanks
Yes, if you are like me, you paid into SS and would expect to get your just retirement amount from SSA. I worked in a government job for a few years of my 50 years of work history and they still leave me with about 40% of what I would make without that few years of government work.
You do not mention a non-covered pension, but that is the topic. Apologies if your discussing something else.
Why is WEP fair? SS is progressive. Lower lifetime earners (SS's 35 year AIME calculation) have a higher replacement rate than higher earners. As a gmvt worker that did not pay FICA, you hide much of your earnings and therefore appear to be a lower earner than you are. This would (and did before WEP) give you an inappropriate replacement rate.
Assuming you had earnings above $15K in today's dollars, any additional earnings are replace at 40% (worst case), but we normal folks only get a replaced rate of 32%. But all the repeal WEP advocates want 90%, about 3 times more than we normal folks.
So…..if I paid into and earned my social security credits by working in the private sector for 23 years, then work for 20 years for a local municipality, am I still penalized by the WEP? I am single.
Not necessarily. I paid 19 years into a teacher’s retirement system, and also 19 years into Social Security. The SSA told me that as a result, I would only receive 40% of my SS benefit HOWEVER, for each additional year that I might be able to pay into SS, that percentage would increase. They also told me that if I can manage to pay a total of 30 years into SS at the minimum earnings rate, then I would qualify for my FULL SS benefits…AND my teacher’s pension. This is absolutely true, as I have now verified it in person at the SSA twice, and it is clearly written as such on the SSA website under Windfall Provision. Soooo in your case, if you can manage to pay an additional 7 years into SS, you’ll receive your full benefits! On another note, the WEP is on the books in Congress this year - 2022 - and it may be completely removed from law. If that happens, it will be to your benefit, as the additional 7 years may no longer be required. Do your own research on this, please!
It depends on your state and municiipality. It is not in all sates. You should contact your former employer (municipality) and ask if they paid FICA taxes or not. Ask them if you have a non-covered pension.
Its on the books every year. Its just a plaything for congressmen and congresswomen
Why is windfall being used by legislatures as a bad word?
Why is WEP fair? SS is progressive. Lower lifetime earners (SS's 35 year AIME calculation) have a higher replacement rate than higher earners. As a gmvt worker that did not pay FICA, you hide much of your earnings and therefore appear to be a lower earner than you are. This would (and did before WEP) give you an inappropriate replacement rate.
Assuming you had earnings above $15K in today's dollars, any additional earnings are replace at 40% (worst case), but we normal folks only get a replaced rate of 32%. But all the repeal WEP advocates want 90%, about 3 times more than we normal folks.
why has $25000 dollars not been increased as years go by for amt after which social security benefits become taxable if you still work......$25000 is poverty level .....i mean thats barely covering rent......and the problem is easily fixed as far as shortage if they just raise the level currently around $146000 at which social security is no longer taxed.......that needs to go way up well over $250000 but of course no politicians want that because it affects their wallets.......but they would rather increase taxes on all of us low and middle class workers
I try to not think of SS as Welfare, that is, I do not think of it as a purely wealth transfer program. If you look at the formula, it is clear that the low earner gets a 90% replacement rate, whereas the highest earner gets about a 28% replacement rate, a mix of 90%, 32%, and 15%. Even the nasty rich folks get something in return for all they contribute.
The Raise the Max advocates don't seem to specify if they are willing to give that rich fellow the15% replacement rate or just take it. BTW, today, one get 15 up to the max. And then there is means testing...
Note that no one currently only receiving SS gets to pay the tax you refer to. Only those with additional taxable income get that pleasure. Consider yourself part of those folks that are considered to be getting too much and get to return some of it back to the SSA - yes, those collected taxes to to SSA, not the general fund. Lucky-you (and ME).
Note that because those tax cliffs were set in the 80's and 90's, as time passes more folks will get to join in. And at some point everyone will get that pleasure. Yet another benefit of inflation.
Does WEP apply to retired active duty military personnel receiving a pension?
NO!
I worked 26 substantially earnings in the US and 23 years in Germany. Will they deduct me $200 once I get my pension from Germany?
It's hard to say without more details. I would suggest that you contact the Social Security Administration and ask them to calculate for you.
@@FinancialFastLane they don’t know anything, if you call the 1 800 number. You have to make an appointment and hopefully a knowledgeable person that knows about WEP is on the phone. Thanks for your quick reply. One more question: does the “amount” of the uncovered pension matter to determine WEP?
@@beautyRest1 I don't believe the amount of the pension is a factor, rather the time that you had substantial earnings that paid into Social Security.
@@FinancialFastLane thank you for answering. I went thru hell with SS, because they deducted about $160 from my SS, even though I didn’t even apply for my pension. The application for SS asked if I expect in the future a pension from another country. Of course I answered yes, and that did it. One answer from the SS person told me, that I was just too honest, (you wouldn’t believe all the things they told me) . Now I applied in March for my German pension, but didn’t tell SS yet, until I get a statement from Germany what I will receive and when. Germany thinks I may not fall under WEP , because of what is call “totalization “. But they look into it and will supply me a letter that states I should not fall under WEP. This is a big mess, but now I let the chips fall where they may fall. Again, thanks for answering me!!
Same here. Did you get an answer.
If you retire from government with a pension and go back to work in private sector, you will eventually be subjected to WEP and possibly get no social security. Why then do you still need to pay into social security in your new job? Also WEP seems to be biased against “government” pension compared to private pension.
Perfect question and one I have asked SSA many times. They just don't respond. I filed an appeal and have not received confirmation of the appeal in 3 months (they even refused to sign for the mailing). Time to contact my senator's office again.
Military get both a military pension and SS. If they then take a new job an pay into SS their SS just continues to increase. They would also receive a pension from the second job if it is offered. Many retired military receive a military pension, SS, and private job pension, three checks. Sweet!
It is not the pension, it is the non-covered pension; pay FICA, then no WEP. Your CHEAP state did not pay FICA and you did not contribute your share. ALL private pension recipients paid FICA.
We normal folks all pay FICA, don't get a choice. 35 years are used in the calculation, but we might pay for 50 years, they don't return or discount FICA during the other years.
@@jonathon4051 - Because the military pays FICA. Yes, really sweat, because all of those employments paid FICA. This is a CHEAP state problem, not an SS problem.
I am a retired cop......not yet retired, but if i understand the windfall correctly they will be taking 60 percent of my ss.....i have a small ss that will be 1000 k when I turn 62 and I will be left with 400 dollars each month...for the life of me I do not understand why I have to get dinged on this...I did not pull the 40 quarters out of my ass....I worked for that from 1981 to 2019 of course with some very small earning years and even about 5 zero years.... I can not complain due to have 3 pensions and a VA disability, but I still busted my butt for those quarters....Oh well....
Why is WEP fair? SS is progressive. Lower lifetime earners (SS's 35 year AIME calculation) have a higher replacement rate than higher earners. As a gmvt worker that did not pay FICA, you hide much of your earnings and therefore appear to be a lower earner than you are. This would (and did before WEP) give you an inappropriate replacement rate.
Assuming you had earnings above $15K in today's dollars, any additional earnings are replace at 40% (worst case), but we normal folks only get a replaced rate of 32%. But all the repeal WEP advocates want 90%, about 3 times more than we normal folks.
BTW, thank-you for your service. I only did a short stint in the Chair Force. :)
I was forced to pay into both programs and the government stealing from me
So it makes no sense for me to get a job covered by Social Security because I will never see a penny of what I pay into Social Security because I have a pension. No wonder they can't find people to work.
So nice to pay into to something you will never see....Gotta Love dat socialism...not finding people work is a different story though.
@@richbrake9910 that is true. Many reasons why people don't want to work today, mine is just a very small reason. I am thinking more about going back at least part time though.
Oh! The gov can find plenty of people to work. The private sector is the one finding it hard to find people to work.
@@jonathon4051 Actually I was involved in the hiring process at my job at a local government entity. We had great difficulty getting people.and had many jobs open for over a year. The pay had not kept up with the private sector. We would get several applications but when it came time to schedule an interview we had no takers. On the rare occasion that we found someone we had to start them close to top step on the pay scale just to get them in the door. I hadn't been rejected so much since my hgh school dating years lol. Thank You and take care.
I grew up in a different time; I wanted the paycheck. In fact, I am rather surprised by the attention SS appears to get. It did not get any mind-time until I hit 50 or so and then built a spreadsheet to understand it and maximize what I could.
As a point, all those old, seemingly retired folks (my generation) you see working at grocery stores, fast food, retail, etc are likely working for the paycheck, maybe some comradery, but it is unlikely they are affecting their SS check in any way. One's SS PIA is determined by the highest 35 indexed earning years, additional part time work rarely replaces one of those years. So all those old fools are working for the money, not SS. No they do not want to pay FICA, but they don't get a choice and they like paying rent and eating.
Sorry nothing new here for me
Yeah great. I had enough credits without my government job that I have a disability retirement through, after only working for them for a few years. Even though I worked in other jobs before and after that government job. This law is so unjust. I hope Senator Brown can get his bill through to eliminate this horrid law.
Our Government is why
Our government is SUCH OF MESS.THANK YOU TO OUR GOVERMENT FOR TAKING CARE ILLEGALS AND SENDING MONEY TO OTHER COUNTRIES.
SENDING GAS TO UKRAINE AND MONEY TO BAIL OTHER THINGS.
you sound like a real bonkers MAGA
I rather agree with your sentiments, but none of that is related to SS. By law, it is separate. It is also a very poorly designed program that is doomed to fail.