Social Security Fairness Act Passed! Good news for employees and retirees in the Ohio Public Pension Plans

Are you covered by either STRS, SERS, or PERS?  If you are a current or retired teacher, police officer, fireman, or other city or state worker, the answer is probably "yes".  Up until now, if you also worked in the private sector, and paid into Social Security, you were subject to a very frustrating (and arguably unfair) set of provisions:  The Windfall Elimination Provision and the Government Pension Offset.

 

The Windfall Elimination Provision, enacted in 1983, reduces the Social Security benefits of workers who receive pensions from a federal, state, or local government for employment not covered by Social Security. The Government Pension Offset (GPO), enacted in 1977, reduces Social Security spousal benefits for spouses, widows, and widowers whose spouses receive pensions from a federal, state, or local government.  This reduction in their "promised" Social Security can be significant - up to half of what they wouldn't received if it weren't for their public pension.

 

This has now all changed as The Social Security Fairness Act was signed into law on January 5^th by President Joe Biden.  Many retirees will get significant increases in their Social Security.  The Congressional Budget Office estimates that affected retirees could see their Social Security Benefits increase from $360-$1,190 per month.  Even better, this will be retroactive from January 2024, meaning retirees will get back-pay from that date.  Again, you have to be covered by a state pension (SERS, PERS, STRS) to be eligible.

 

For those eligible, the Social Security Administration will be releasing instructions in the weeks/months ahead on how to apply and begin receiving your fair share!

 

If you are a current client reading this and you think you might be affected, contact me and we will discuss together!