Social Security Issues

Windfall Elimination Provision (WEP) and Government Pension Offset (GPO)

The Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) alters the way in which a Social Security benefit is calculated for individuals who have paid into both Social Security and a government pension plan.

The WEP was created in 1983 to address the situations of individuals who have worked outside of Social Security but are also eligible for a Social Security benefit. Generally, the WEP reduces the percentage of salary that is used in the calculation of a Social Security benefit for individuals with less than 30 years of substantial earnings under the program. The WEP impacts most teachers who work outside of Social Security because they frequently do not have 30 years of substantial earnings under the program.

The GPO reduces or offsets a survivor or spousal benefit under Social Security by $2 for every $3 received from an individual’s pension benefit earned through non-covered employment. These individuals are entitled to Social Security benefits because they are the spouse or survivor of an individual who is eligible for such benefits. In the absence of any offset provision, the spousal benefit is 50 percent of the benefit if the covered spouse is alive. A survivor benefit is 100 percent of the benefit if the covered spouse is deceased.

WEP and GPO Legislation

Legislation concerning the WEP and the GPO has been introduced into the 110th session of Congress. These pieces of legislation are similar to proposals introduced during the 109th session of Congress. The goal of these proposals is either to eliminate the GPO and WEP or to reduce the impact of these offsets for public employees.

Illinois is one of 14 states with employees negatively affected by the Social Security reductions.  Most states, including Illinois, have some covered employees and others unaffected.  Due to this, each state has widely-different, affected populations of employees.  The other states include:

• Alaska
• California
• Connecticut
• Georgia
• Louisiana
• Kentucky
• Maine
• Massachusetts
• Missouri
• Nevada
• Ohio
• Rhode Island
• Texas

WEP and GPO Elimination Provision Proposal

Click here to go to the Library of Congress Web site to view current bill summaries. Enter the bill number into the search box for specific bill information.

Mandatory Social Security Update

Due to the emphasis on Social Security reform the Illinois Teachers' Retirement System (TRS) has updated the estimated cost impact of mandatory Social Security on Illinois public education.

For more information, please click here.

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