How do I calculate pension offset to SS, under WEP?

[Amethyst]

Checking my Medicare application on SSA.gov, I saw a notification that floored me. See, I'm in the old Civil Service Retirement System, and paid into that pension plan instead of into SS. Before that career, I had a couple of full-time jobs, with 18 months of paying into SS (all my other earnings were in on-campus jobs, which were exempt).

After retirement, I worked part-time as a contractor/consultant for five years. I assumed that couldn't be enough time paying into SS, to fill out 40 quarters. Turns out I was wrong. At age 67, if I weren't CSRS, I would be eligible for $860.00 per month.

Looks like, Windfall Elimination (WEP) would reduce this amount by about half. However, I'm not clear on how to do the calculations/find the data. Could someone explain it?

Thanks,

Amethyst

 

[ChrisC]

https://www.ssa.gov/benefits/retirement/planner/anyPiaWepjs04.html

 

[Amethyst]

The calculator told me I can expect NO SS benefit, because my pension more than offsets it - which is what I expected to begin with, so no harm done, other than wasted screen time.

Thanks for pointing me to the correct page!

 

[Sue J]

There is a cap on the WEP reduction of $498 for 2021.

 

[Amethyst]

Hi Sue,

That's what I thought, too, based on the text under WEP on SSA.gov.

But, the Calculator says I get nothing.

I wonder if it's worth calling SS? I've never found them to be anything but frustrating to talk to.

There is a cap on the WEP reduction of $498 for 2021.

 

[youbet]

The calculator told me I can expect NO SS benefit, because my pension more than offsets it - which is what I expected to begin with, so no harm done, other than wasted screen time.

Thanks for pointing me to the correct page!

Sounds like you did the calculation for GPO. Look for the calculator for WEP. Two very different things. The links to both calculators are on the page ChrisC referenced, so just be careful to click on the correct one.

You'll be losing approximately half your SS because of WEP based on your OP comments.

 

[Gumby]

Yes. WEP cannot ever entirely wipe out your own SS. GPO, however, can wipe out your spousal and/or survivor benefit.

 

[Amethyst]

Fortunately, we can "survive" not getting a SS benefit

Yes. WEP cannot ever entirely wipe out your own SS. GPO, however, can wipe out your spousal and/or survivor benefit.

 

[Amethyst]

Nope. It definitely says "WEP Calculator."

I went back and entered earnings for 2020 (when I did not work at all). Got a small benefit, that time.

To me, it looks as if the Benefits Calculator, which says I do have 40 quarters, disagrees with the WEP Calculator, which says, in effect, that I don't.

I checked my data entry carefully for accuracy.

Oh well.

Sounds like you did the calculation for GPO. Look for the calculator for WEP. Two very different things. The links to both calculators are on the page ChrisC referenced, so just be careful to click on the correct one.

You'll be losing approximately half your SS because of WEP based on your OP comments.

 

[steelyman]

Not an expert but I thought I read about some minimum substantial earnings level applied when calculating SS benefits (not Medicare where only quarters count).

 

[ChrisC]

Fortunately, we can "survive" not getting a SS benefit

You'll get a benefit; it's reduced under the 50% guarantee rule but I have difficulty explaining this rule so here's one of the official description of how the rule is calculated: https://secure.ssa.gov/poms.nsf/lnx/0300605370. My WEP reduced payment is $294 per month after 35 years under CSRS and just barely meeting the 40 quarters of coverage test from a few years of mainly low wage income. My wife's spousal SS payment on my PIA was $171 per month (as she filed a restricted application for spousal benefits and just recently started receiving her own benefits on her own record to which I can't get any spousal benefits under GPO).

Like you, I became SS eligible after retirement from CSRS; at retirement I had 37 quarters and picked up the remaining credits with a part-time consulting gig for a few months that put me over the top. I applied immediately online at 64 for SS, WEP reduced and when my wife reached 66 (and under then current SS law) at her FRA she was able to apply for spousal benefits under my record.

I'd apply online immediately if I were you -- I didn't see any major benefit to delay the paltry amount of WEP reduced benefits to age 66 or 70, in my case.

The 50% guarantee is mentioned in this document: https://www.ssa.gov/pubs/EN-05-10045.pdf Also, here's a more extended discussion of WEP from Kitces: https://www.kitces.com/blog/navigat...on-wep-with-a-non-covered-government-pension/