I've been looking at the WEP rules and have discussed it with a few FA. [note, the FA's don't seem to keep up on WEP, even the ones that say they target government employees
My question is in regards to the Social Security Program Operations Manual System (POMS) RS 00605.364 Determining Pension Applicability, Eligibility Date, and Monthly Amount; Effective Dates: 10/12/2017 - Present. https://secure.ssa.gov/apps10/poms.n.../0300605364#c4
The document goes over the usual stuff, including what to do if a defined contribution plan provides a lump sum upon retirement. However, at the very bottom of the document, under 'Part D. Change in pension amount' there is this phrase: "However, if the pension ceases and the NH is no longer entitled to the pension, recompute the PIA without considering the pension effective with the first month for which the claimant is no longer entitled to the pension. " (NH=number holder)
So my question is what does this mean? Does it only apply to a defined benefit pension? Or if a person in a defined contribution pension has lump sum or variable payments as determined by that person and the funds are exhausted, does that count an 'no longer entitled'? That would seem to be contrary to section 5 'Entire pension paid in a lump sum'. Under the lump sum scheme, a person could end up with a 'phantom pension', as in one that they do not receive a benefit from but it is still counted against their SS.
In DW case, she went for the 10 year payout option of her defined contribution pension. Because she can determine the monthly payout amount, that may not apply to the statement in Part D? as opposed to a defined benefit pension that only was scheduled to last 10 years.