We wanted to bring to your attention a recent CNBC Article highlighting changes in Social Security benefits that may impact some individuals, particularly those receiving pensions from non-Social Security-covered work. An example of this could be working as a public servant, where wages were NOT subject to Social Security (FICA) taxes.
The article discusses the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO), which can result in reduced benefits for those receiving non-Social Security pensions. As of December 2022, approximately 3% of Social Security beneficiaries are affected by WEP, and about 734,601 are affected by GPO.
One such case is highlighted in the article, where a retiree experienced an unexpected reduction in her Social Security benefits and had to repay an overpayment of $5,000 due to these rules.
If these rules may impact you or anyone you know, it’s crucial to be aware of potential changes in retirement income and plan accordingly. Congress is considering the Social Security Fairness Act, a bipartisan proposal aiming to eliminate both WEP and GPO, but until then, affected individuals must navigate these complex rules.
If you have any questions or concerns about how these rules may affect your specific situation, please don’t hesitate to reach out to us.
