Will The Windfall Elimination Provision Affect You When You Apply For Social Security?

If you work for a federal, state or local government agency, a nonprofit organization or in another country, you may be eligible for a pension based on earnings not covered by Social Security.

A pension based on earnings not covered by Social Security can affect the amount of your Social Security benefit. We do not know whether you are eligible for such a pension until you actually apply for retirement benefits, so the benefit estimates you have received may not have been adjusted for such a possibility.

We have a Fact Sheet on our website www.ssa.gov/pubs/EN-05-10045.pdf which explains the details about the provision. If you will receive a pension and you did not pay the FICA tax on it, you should read the Fact Sheet.

After you have read the Fact Sheet, you will know whether your Social Security will be affected by WEP. We have tools on the website to help you figure out the dollar amount of the benefit if WEP applies. We have a chart which shows you the greatest potential amount of reduction in your Social Security check in your eligibility year www.ssa.gov/planners/retire/wep-chart.html. We also have a WEP calculator www.ssa.gov/planners/retire/anyPiaWepjs04.html to figure a benefit estimate for Social Security benefits considering the amount of your non-covered pension (no FICA tax paid on the earnings that produced the pension)..

Next time I’ll talk about pointers to use the WEP Calculator.