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Retired Americans who are recipients of pensions as former public employees may soon begin receiving higher Social Security benefits after a recently-enacted law took effect.
The Social Security Fairness Act was signed into law by then-President Joe Biden on Jan. 5 and eliminated policies known as the Windfall Elimination Provision (WEP) and Government Pension (Offset). Those policies reduced or eliminated Social Security benefits for more than 3.2 million people who receive a pension for work that wasn’t covered by Social Security because they didn’t pay Social Security taxes.
Among the groups of people who were affected include certain teachers, firefighters and police officers in many states; federal employees covered by the Civil Service Retirement System; and people whose work was covered by a foreign social security system. It doesn’t apply to all such people because about 72% of state and local public employees work in roles covered by Social Security and pay into the system — so they won’t see a benefit increase under the new law.
The Social Security Administration (SSA) explained that the size of the monthly benefit change can vary greatly based on the type of benefit received and the amount of the person’s public pension. Some individuals may see only a very small increase, while others may be eligible for over $1,000 more each month, the agency noted.
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Some Social Security beneficiaries will see their benefits increase under the new law. (Kevin Dietsch/Getty Images / Getty Images)
SSA announced that starting this week, the agency is beginning to pay retroactive benefits and will increase monthly benefit payments to individuals whose payments were affected by the WEP and GPO policies.
The elimination of those policies is retroactive back to January 2024 and if a Social Security beneficiary is impacted by the policy change, they’ll receive a one-time retroactive payment deposited into the account SSA has on file by the end of March.
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The Social Security Administration said that retroactive benefit hikes will be paid out in a one-time payment to eligible beneficiaries. (Jeffrey Greenberg/Education Images/Universal Images Group via / Getty Images)
“Social Security’s aggressive schedule to start issuing retroactive payments in February and increase monthly benefit payments beginning in April supports President Trump’s priority to implement the Social Security Fairness Act as quickly as possible,” said Lee Dudek, Acting Commissioner of Social Security. “The agency’s original estimate of taking a year or more now will only apply to complex cases that cannot be processed by automation.”
Social Security beneficiaries impacted by the change will start getting payments with their new monthly benefit starting in April for their March benefit, because Social Security benefits are paid one month behind.
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Then-President Joe Biden signed the Social Security Fairness Act into law in early January. (Reuters/Nathan Howard / Reuters Photos)
SSA noted that affected beneficiaries may receive a pair of mailed notices, the first notifying them that WEP or GPO is removed from their record, and a second when their monthly benefit amount is adjusted for their new monthly payment amount. The retroactive payment may be received before the mailed notice.
“We urge beneficiaries to wait until April to inquire about the status of their retroactive payment, since these payments will process incrementally throughout March,” SSA wrote. “Beneficiaries should also wait until after receiving their April payment before contacting SSA to ask about their monthly benefit amount because the new amount will not be reflected until April for their March payment.”
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SSA added that if a beneficiary has their Medicare premiums deducted from their Civil Service Retirement System annuity and then applies for Social Security benefits, their premiums will be deducted from their monthly Social Security benefits.
The nonpartisan Committee for a Responsible Federal Budget noted that the Social Security Fairness Act added $196 billion to the federal deficit over the next decade and is projected to hasten the insolvency of Social Security’s main trust fund by six months.
