Increased Social Security Benefits for Some Retirees

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On January 5, 2025, the President signed the Social Security Fairness Act, which will repeal both the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) provisions of Social Security. This will impact retirees who have had their retirement, spousal or widow’s benefits reduced due to either provision and will also eliminate the potential reductions going forward.

The bill repeals the impact of WEP and GPO “with respect to monthly insurance benefits payable under Title II of the Social Security Act for months after December 2023,” allowing for back payments for all of 2024.

The provisions are as follows: 

  1. Windfall Elimination Provision – could reduce Social Security benefits if the retiree was receiving a pension from work in non-covered employment (i.e. government, public service workers) and did not contribute a portion of their income toward Social Security (have Social Security payroll taxes withheld)
  2. Government Pension Offset – applied up to a 2/3 reduction to a spouse or widow’s Social Security benefit who worked in non-covered employment and did not contribute a portion of their income toward Social Security, if they were receiving a governmental pension and a spouse or widow’s benefit from Social Security. 

Clients who are impacted by this repeal might be wondering if they have to do anything in order to receive their increased payout. The Social Security Administration (SSA) has stated that it is evaluating how to implement the Act and at this time, retirees do not need to take any action except to verify that the SSA has their current mailing address and direct deposit information, if it has recently changed.

We hope this information is timely and assists you in providing great service to your clients who might have questions regarding electing benefits or upcoming changes to their Social Security benefits. Remember to work in tandem with your client’s tax advisors to help your clients make the best choice possible for their retirement income and survivor needs.