The Social Security Fairness Act is now in full effect, with the Social Security Administration announcing today that as of March 4, it has issued more than $7.5 billion in retroactive payments to nearly 1.13 million eligible beneficiaries.
The act gets rid of two rules and will result in a boost in monthly payments for former and current public employees who previously had their benefits reduced due to having “noncovered pensions.” Before the boost in monthly payments takes place, the SSA is prioritizing retroactive payments, which will continue to be sent incrementally throughout the month of March.
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The SSA says the average retroactive payment so far is $6,710.
Qualifying individuals will begin to see their higher monthly payment in April for their March benefit. Read on to find out exactly what rules were repealed and who benefits from the Social Security Fairness Act.
For more, don’t miss the Social Security payment schedule and how to apply for Supplemental Security Income.
What is the Social Security Fairness Act?
The Social Security Fairness Act was passed by the House in November, and signed by former President Joe Biden on Jan. 5. It eliminates earlier rules that limited payments to public service workers such as teachers, firefighters, postal service workers and police officers, meaning that those people will soon receive bigger payouts.
Specifically, it repeals these two rules:
The Windfall Elimination Provision (PDF), enacted in 1983, is a formula used to adjust Social Security worker benefits for people who receive “noncovered pensions” and who qualify for Social Security benefits on other earnings that are covered by Social Security. A noncovered pension is one paid by someone’s employer that did not withhold Social Security taxes from their salary.
The Congressional Budget Office predicts (PDF) the elimination of the WEP would increase benefits by $360 on average for 2.1 million Social Security beneficiaries. This would further increase to $460 on average for 1.8 million recipients by December 2033.
The Government Pension Offset was enacted in 1977 and adjusted in 1983 and reduced the Social Security benefits of spouses, widows and widowers who also received government pensions of their own.
The elimination of the GPO, the CBO predicts, will increase monthly benefits payments by around $700 for spouses and $1,190 for surviving spouses in December 2025. By December 2033, payments would be up to $860 and $1,520, respectively.
Collectively, only about 4% of all Social Security beneficiaries (PDF) are affected by the WEP and GPO, but the impact on those households could be profound. The act applies to payable benefits after December of 2023, meaning back payments will be issued for qualifying individuals.
Due to the increase in Social Security payments, the CBO estimates a reduction in Supplemental Nutrition Assistance Program payments for those who participate in both programs.
What should qualifying individuals do in the meantime?
Now that the Social Security Fairness Act has gone into effect, there isn’t much a qualifying individual needs to do.
The only thing the SSA suggests is to have your current mailing address and direct deposit information listed in your account. You can do this online via your my Social Security account, by calling 1-800-772-1213 or by visiting a local office.
For more, don’t miss our Social Security and SSDI cheat sheet and four ways you could potentially lose your Social Security benefits.
