Government Pension Offset and Windfall Elimination Provision

The Government Pension Offset (GPO) affects spousal Social Security benefits, reducing them by two-thirds the amount of an annuitant's monthly TRS pension. In many cases, the benefits are eliminated entirely.

The Windfall Elimination Provision (WEP) significantly reduces an individual's Social Security benefits using a modified formula.

GPO
The Government Pension Offset (GPO) eliminates or reduces the spousal Security benefit by two-thirds the value of a teacher’s retirement benefit.  This deduction occurs whether the Social Security receiving spouse is alive, deceased, or divorced.  Remember, the GPO only impacts those individuals who were not eligible to retire prior to December 31, 1982 (at least age 55 and twenty years of credible service.)  The following examples help clarify how the GPO can affect an individual in these different circumstances. 

Additional information may found on the Social Security website (http://www.socialsecurity.gov/retire2/gpo.htm). Download a PDF about the GPO at the following link: http://www.socialsecurity.gov/pubs/10007.pdf.

 

Example:

Michael collects a Social Security benefit of $800 per month.  His wife Jan, who is a retired public school teacher, worked for a school district that did not pay into Social Security for its employees.  Jan receives a monthly annuity from TRS of $1,200. For the purpose of this example, both Michael and Jan are 65 or older.

 

 

Effect of GPO with Living Spouse 
Jan’s potential Social Security:               Benefit: $800 x 1/2 = $400
Amount Calculated for GPO reduction:  $1, 200 x 2/3 = $800
Total monthly Social Security benefit:    $400 - $800 = No benefit
Effect of GPO upon Death or Divorce
Jan’s potential Social Security Benefit:   $800
Amount Calculated for GPO reduction:   $1,200 x 2/3 = $800
Total Social Security Benefit:                   $800 - $800 = No benefit

 

These examples illustrate a complete offset, whereas in other situations there may not be a complete offset.  It is important to remember that in cases where a complete offset has not occurred, any increase in the teacher’s benefit will result in a recalculation of the Social Security benefit.  In other words, as the teacher’s annuity goes up, the Social Security benefit goes down.

GPO/WEP Sample Letter
A sample letter is provided below for TRTA members to use when contacting their Congressional representatives in both the U.S. Senate and House of Representatives.

"Dear U.S. Senator/U.S. Representative:
I am a retired public educator from (insert where you taught) writing you about two unjust social Security provisions that affect hundreds of thousands of retired educators and other public employees across the country. These provisions are known as the Government Pension Offset (GPO) and the Windfall Elimination Provision (WEP). I urge Congress to enact legislation repealing these two Social Security provisions.
The Government Pension Offset (GPO) eliminates or reduces the spousal Social Security benefit by two-thirds the value of a teacher’s retirement benefit. The WEP reduces (but does not eliminate) a portion of an individual’s Social Security earned from other work outside of his/her public employment.
I am affected by the (insert your personal story here about how the GPO, the WEP or both have affected you).
I am asking that you support legislation to repeal the GPO and WEP. The repeal of the GPO and the WEP would benefit thousands of public servants now being penalized for their lives’ work. Lawmakers have promised to help seniors with various programs or reforms. These are hard times for seniors living on fixed incomes. The costs of health insurance, prescription drugs and general cost-of-living expenses continue to increase. Thank you for taking the time to consider this issue. I look forward to hearing from you on how you will help in this endeavor."

WEP 
The formula used for calculating the first portion of the Social Security benefit will be reduced if you have less than 30 years of “substantial” earnings in Social Security.  To learn more, please visit the Social Security Administration website (http://www.socialsecurity.gov/retire2/wep.htm).

Please view the Social Security Administration's flyer on how to calculate your benefits if you are impacted by the Windfall Elimination Provision (http://www.socialsecurity.gov/pubs/10045.pdf).

Contact a Social Security representative (800.772.1213 or www.ssa.gov) to verify your years of "substantial" earnings and request a calculation of your Social Security benefit.
 
Additional Resources on Social Security Fairness
http://www.ssfairness.com/