Windfall elimination provision

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Q. Does the WEP start when you sign up for Social Security or when you retire from your non-SS job?

A. First things first: Unless you have reached your full Social Security retirement age and are still working, any Social Security benefit you are entitled to would be reduced by $1 for every $2 you earn above the Social Security earning limit. In 2019 that limit is $17,640. Full Social Security retirement ages range from 65 to 67, depending on your year of birth.
After you retire, the windfall elimination provision would apply. The amount of Social Security benefit you’d be entitled to would depend on how many years of “substantial” earnings you have under Social Security. In 2019, you would have to earn $24,675 for those earnings to be considered substantial. The fewer years of Social Security-covered earnings, the greater the reduction in your Social Security benefit. For more information about the WEP, go to www.ssa.gov/planners/retire/gpo-wep.html.

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About Author

Reg Jones was head of retirement and insurance policy at the Office of Personnel Management. Email your retirement-related questions to fedexperts@federaltimes.com.

22 Comments

  1. Thanks for your response. I read another column elsewhere that said WEP applied as soon as you began drawing SS, even if you were full SS age and were still working at your Federal job. As a CSRS-OFFSET employee subject to WEP, I plan to draw SS when I reach full SS retirement age and not retire as a Fed for a couple of years after that. I was looking forward to getting full SS for during that time. I know when I retire, WEP will reduce my SS drastically.

    • If you have fewer that 30 years of substantial earnings under Social Security, the WEP will reduce your benefit regardless of when you apply for it.

      • OK, now I am confused. If I am still working as a Fed under CSRS-Offset, but decide to draw SS once I reach full SS retirement age, you are saying the WEP applies then? I don’t see how SS can apply the WEP before I receive a Federal pension. I understand that the WEP will apply after I have retired as a Fed and am actually receiving a CSRS-Offset pension. I will have about 20 years paying into SS so know that the full WEP takes effect once I am retired as a Fed.

        • Sorry for the confusion. If you have reached full Social Security retirement age and are still working, you’ll receive any Social Security benefit to which you are entitled based on your work history. At retirement, that benefit will be affected by the WEP. Depending on your years of substantial earnings under Social Security, it might be reduced from what you were receiving before you retired.

  2. Clarity question, using this same scenario, if the individual retires under CSRS, but also earns a pension where he or she paid into SS, however…they opted not to receive SS until they have reached their FRA, would they still be penalized by the WEP reduction in the SS? So basically, does the WEP reduction apply regardless as to whether your age 62 or FRA?

  3. As a CSRS-offset for 36 years I retired as GS13 at FRA, had substantial SS for 50 years. I don’t plan to draw SS until max age of 70. I retired “early” to be CareGiver for my spouse – but don’t draw a salary for that. WEP takes about $1,400/month from my pension even though I don’t draw SS.
    Will having no income (work paying into SS) negatively affect what I draw from SS at 70 yrs old (total of 3 years “No income”)?

    • It is not WEP taking money from your CSRS-Offset pension. WEP only takes money from your SS. What’s happening to your pension is the “offset” part of CSRS-Offset. How that works is that whatever SS you earned WHILE A CSRS-OFFSET EMPLOYEE is “taken away” from your CSRS-Offset pension. There is a formula for it: SS monthly amount x years in CSRS-Offset/40

      That is what will be taken away from your CSRS-Offset pension. The more years you worked under CSRS-Offset, the greater SS you earned and the greater the “offset” against your CSRS-Offset pension.

  4. Is it possible for the reduction in Social Security to be greater than my actual monthly pension amount. I was told that I would lose $480 in monthly benefits but my pension is less than that.

    • To understand what’s going on, I need more information. What retirement system are you in, CSRS, CSRS Offset or FERS? Have you been receiving a Social Security benefit or are you just learning what that benefit would be and that it won’t be paid to you?

  5. My question is similar to the question above. I worked for 10 years in Poland before coming to the US. I worked about 25 years in the US, but only 20 of those years included substantial earnings. I am eligible for a small pension in Poland, but that would only be about $250 per month. Is it possible for the reduction in Social Security to be greater than my actual monthly pension amount? I was told that I would lose $480 in monthly benefits but my pension is less than that. Would WIndfall provision only apply if I actually receive the other pension from Poland. If my Social Security reduction would exceed the amount of the Polish pension, then is forfeiting the pension the only way to preserve my unreduced Social Security income?

    • If you are eligible for a pension based on work you did in another country and you didn’t pay Social Security taxes on those earnings, that pension can affect the amount of your Social Security benefit. I don’t know if it’s possible to forfeit that benefit and eliminate its affect on your pension. To find out you’ll have to call the Social Security Administration at 1-800-772-1213 and talk to one of their benefits specialists.

  6. Thank you for your answer. I have already found out the answer to my question by carefully reading and analyzing different publications related to the Windfall Provision. A pension on any work not covered by social security can only be reduced up to 50% or $480 – the lesser of the two amount. Even if a pension is very low, it can still be reduced up to 50% but this reduction would not lead to forfeiting the pension.

      • The Windfall Elimination Provision applies to anyone who is receiving an annuity – in whole or part – from a job where he or she didn’t pay Social Security taxes. The following example should help explain how the WEP is applied. A Social Security employee who had 30 years of covered service would be entitled to a Social Security benefit of X dollars per year. If he or she had fewer that 30 years, that benefit would be permanently reduced by 5 percent for every year short of 30, until it reached 40 percent with 20 years or less of covered service.

  7. I have 30 social security points. which is not enough to retire. and now I am 65. I thought would have received some social security benefits. Ignorance of youth. I have a county retirement pension. Am I entitled to social security benefits under the WEP. ?

    Thank you for your time.

    • No, you aren’t entitled. You would have to have 40 quarters (10 years) of Social Security-covered employment to be eligible for a benefit.

  8. Crockett DuBose on

    I’m 65 yrs old, and my FRA is May 2021. Currently, I draw a pension from Texas Teacher Retirement System (TRS), additionally, I have 27 years of substantial earnings accumulated and will plan to draw SS are age 70. My understanding is this — once I hit 70, and because I’ve earned 27 substantial years, I will be close to completely wiping out WEP. At 30 yrs of substantial earning years, WEP simply goes away —

    So, knowing all of that, I had a couple of years of work in my past (2013 comes to mind) as a consultant— not sure I paid all of my SS income tax for that year…. can I go back and pay enough to pick up another substantial year? Or, once that year is in the books, is it over —

    Another question, if I start drawing SS at FRA a d go back to work and pay in to SS, and my work earns me another substantial year, will that bring on a new calculation for my monthly total?

    • You would have to check with the Social Security Administration to find out if you did pay taxes for the time when you were a consultant and what the consequences would be if you had failed to do so. Putting that question aside, you can draw a reduced Social Security benefit, go back to work, and earn enough Social Security credits to have your benefit in future years calculated without a reduction.

  9. I worked for the federal government under the CSRS pension system and then quit the government and withdrew all my pension contributions. After a break in service, I came back to work for the federal government under a FERS pension system. When I retire (after less than 30 years under Social Security) will, I get hit with a WEP or offset since my government pension is only from a FERS pension?

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