On January 5, 2025, the Social Security Fairness Act was signed into law. This Act eliminates the Windfall Elimination Provision and Government Pension Offset for roughly 3.2 million people who receive a pension from a job where they did not pay Social Security. But when can they expect to see a bigger check?
Implementation Challenges
The Social Security Administration is still finalizing plans that will allow it to implement the Act while minimizing disruption to the daily workflow and services. Since the Act is retroactive to January 1, 2025, the SSA will be required to adjust past and future benefits for over 3 million people. Much of the work must be done manually on a case-by-case basis and is complex in nature.
Funding Issues
The Social Security Fairness Act did not include funding to implement the law, meaning the new workload does not come with the money to hire additional staff. Already constrained by a staffing shortage and a hiring freeze, taking on this new task will stretch their workforce even thinner. As it stands, over 7,000 people per day are already calling in to speak with a representative about the Act and they expect that number to rise. Under their current budget, SSA estimates it could take more than a year to adjust benefits and pay retroactive benefits.
Impact
While it has been reported that this Act will increase the benefits of teachers, firefighters, and police officers, the truth is that about 72% of state and local public employees pay Social Security taxes and are not affected by the Social Security Fairness Act. For those who have never applied for spouses’ or surviving spouses’ benefits due to the drastic reduction in benefits caused by the WEP and GPO, you should consider applying now that you will be eligible for a full benefit.
Doing the Math
There’s no one answer as to how much your monthly benefit will ultimately increase. Several factors including the type of Social Security benefit and the amount of your pension will determine the amount. Some may only see a small increase while others may end up with an additional $1,000 or more per month. The Congressional Budget Office (CBO) estimated repealing the GPO and WEP will cost $196 billion between 2024 and 2034 and speed up the insolvency of Social Security by six months
To keep up with the latest, visit https://www.ssa.gov/benefits/retirement/social-security-fairness-act.html.
