A new law eliminates provisions that reduced Social Security benefits for some public sector workers and their spouses. This change will result in increased monthly benefits and lump-sum payments for affected beneficiaries.
For some, that could trigger larger tax bills and Medicare premium payments, experts say. The legislation, which passed by a bipartisan majority in both the House and Senate, ends reductions of Social Security benefits for certain individuals who also receive pension income from work in the public sector as firefighters, police officers, teachers and local, state and federal employees. Those beneficiaries are set to see an increase to their monthly benefit checks.
Because the legislation applies to benefits paid throughout 2024, they will also receive lump-sum payments to make up for that time. The additional outlay will move Social Security's trust fund depletion dates six months closer. The program's combined trust funds may pay full benefits until 2035, at which point just 83% of scheduled benefits may be payable. The About 2.1 million beneficiaries — those who were affected by the Windfall Elimination Provision, or WEP — may see $360 more in monthly benefits on average, according to CBO estimates as of December 2025. The WEP, which has now been eliminated, reduced Social Security benefits for workers who also had pension or disability benefits from jobs where they did not pay Social Security payroll taxes. And 390,000 surviving spouses would see an average of $1,190 more, according to CBO's estimates for December 2025. Those beneficiaries were affected by the now-defunct Government Pension Offset, or GPO, which reduced Social Security benefits for spouses, widows and widowers who also receive their own pensions from public sector work. The elimination of the provisions in many ways simplifies retirement income planning for affected beneficiaries, financial advisors say. 'For the people who are affected by this, you're looking at a pretty significant increase, in many cases, of what their retirement income is going to be,' said Michael Daley, director of marketing at HealthView Services. 'It's good news for them'
SOCIAL SECURITY BENEFITS WINDFALL ELIMINATION PROVISION GOVERNMENT PENSION OFFSET RETIREMENT INCOME
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