Repeal of WEP and GPO: What Retirees Need to Know About the Social Security Fairness Act
The repeal of the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) marks a major shift in how many public servants and their spouses receive Social Security benefits. These two provisions have long been criticized for unfairly penalizing retirees with non-covered government pensions, and now, with the passing of the Social Security Fairness Act, thousands of retirees will see their benefits restored—retroactively.
Understanding WEP and GPO
WEP was originally enacted to prevent so-called “windfalls” for retirees who received pensions from jobs not covered by Social Security. It reduced benefits—sometimes significantly—for individuals who also qualified for Social Security through other work. GPO, on the other hand, targeted spousal and survivor benefits, reducing them by up to two-thirds of a non-covered pension, and in many cases, eliminating those benefits altogether.
Now that both provisions have been repealed, retirees affected by these rules can expect higher monthly payments and back pay going all the way back to January 2024.
Retroactive Payments Are Coming
Signed into law on January 5, 2025, the repeal is retroactive to January 1, 2024. The Social Security Administration (SSA) will issue a one-time lump sum for the period between January 2024 and February 2025. For example, if your monthly benefit was reduced by $250 due to WEP, you’ll receive $3,500 in retroactive payments. New higher monthly benefits will begin in April 2025.
SSA is sending out two notices: one confirming the removal of WEP/GPO and the second showing the new monthly amount. If you receive your lump sum before the letters, don’t worry—it’s part of the same process.
What If You Never Applied Because of WEP/GPO?
Now’s your chance. If you or someone you know was ineligible before due to WEP or GPO, you can apply now and still receive benefits retroactively back to January 2024. Spousal benefit applications can be submitted online, while survivor benefits must be handled by phone. Call the SSA at 1-800-772-1213 and say “Fairness Act” to speak with someone who understands the new policy.
The online application system hasn’t yet been updated to reflect the repeal, but SSA has confirmed that pension information will no longer reduce your benefits.
Tax and Medicare Considerations
Receiving a large lump sum in 2025 might increase your taxable income for the year. Social Security benefits become taxable once your income exceeds certain thresholds. Fortunately, the IRS allows you to spread the taxable portion across previous years using a “lump sum election,” which could help lower your tax liability.
Additionally, higher Social Security income may trigger increases in your Medicare premiums under IRMAA (Income-Related Monthly Adjustment Amounts). If your premiums go up due to this change in law, you can file an appeal to potentially avoid the hike.
Check Your SSA Account
If you haven’t already, set up your online SSA account at ssa.gov/myaccount. It’s the best way to verify your earnings, keep track of benefits, and stay informed—especially during times like these when major policy changes are underway.
Stay Updated
I’ve created a video and a detailed thread covering everything you need to know about the WEP/GPO repeal. Make sure you’re subscribed to my channel so you don’t miss important updates, and please share this with anyone who might benefit—especially retirees or public workers who’ve been affected by these provisions.
Let’s make sure everyone gets the benefits they’ve earned.
All writings are for educational and entertainment purposes only and does not provide investment or financial advice of any kind.
