For years, the future of Social Security has been uncertain, leaving many workers worried about their benefits.
To address this, the Social Security Fairness Act has been introduced in Congress, gaining support from both Democrats and Republicans.
This bill aims to fix unfair rules that reduce Social Security benefits for workers who also qualify for pensions from jobs that did not pay into the system.
What is the Social Security Fairness Act?
The Social Security Fairness Act is designed to eliminate two key rules that reduce benefits for certain workers:
- Government Pension Offset (GPO):
- The GPO reduces Social Security spousal or widow(er) benefits for those who receive “non-covered pensions.” These pensions are from employers that don’t deduct Social Security taxes, such as state or local governments or foreign employers.
- Under the GPO, spousal or widow(er) benefits are reduced by two-thirds of the non-covered pension amount. For example, if someone has a $1,000 non-covered pension, their Social Security spousal benefit could be cut by $667.
- Windfall Elimination Provision (WEP):
- The WEP reduces Social Security worker benefits for those with pensions from jobs that didn’t pay Social Security taxes. It uses a formula that lowers benefits for people with mixed earnings histories.
By eliminating these rules, the bill ensures fair access to Social Security benefits for those who also earn other types of pensions.
How Did the Bill Gain Momentum?
The bill was introduced by Representatives Garrett Graves (Republican, Louisiana) and Abigail Spanberger (Democrat, Virginia).
With bipartisan support, including backing from over 300 lawmakers and House Speaker Mike Johnson,
the bill advanced through Congress using a rare method called a discharge petition. This process allowed it to bypass delays and proceed to a vote.
The bill now requires a supermajority vote to pass in the House before heading to the Senate and, ultimately, the President for approval. If signed into law, the changes would apply to benefits starting after December 2023.
How Could This Impact People?
If passed, the Social Security Fairness Act would significantly increase benefits for many retirees. For example:
- A person currently receiving a reduced spousal benefit of $233 (due to a $1,000 non-covered pension) would receive the full $900 spousal benefit if the GPO is eliminated.
This change could improve financial security for countless retirees and their families.
The Social Security Fairness Act represents a major step toward ensuring fairness for workers with diverse employment histories.
By eliminating the GPO and WEP, the bill would allow many Americans to receive their full Social Security benefits without penalties.
With bipartisan support and growing momentum, there’s hope that this legislation could soon become law and bring meaningful change to the lives of retirees across the country.
What does the Social Security Fairness Act aim to do?
It aims to eliminate the GPO and WEP, which reduce Social Security benefits for people with non-covered pensions.
Who is affected by the GPO and WEP rules?
Workers with pensions from jobs that did not deduct Social Security taxes, such as state and local government employees or those working abroad.
How would the bill impact benefits?
It would allow retirees to receive their full Social Security benefits without reductions caused by non-covered pensions.
What is the current status of the bill?
The bill has strong support in the House and is awaiting further votes. It needs approval in both the House and Senate before the President can sign it into law.
When would the changes take effect if the bill is passed?
The changes would apply to benefits starting after December 2023.
