Understanding the Social Security Fairness Act—and Who Benefits from It

Great news for certain retirees in Massachusetts and across the country! The Social Security Fairness Act (SSFA), which was signed into law by former President Biden, eliminates rules that reduced Social Security benefits for certain retirees receiving income from public pensions. Nearly three million teachers, firefighters, police officers, and other public sector workers nationwide will see increases in their Social Security benefits.
 
The SSFA repeals two laws that reduced benefits for those receiving “non-covered” public pensions: the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). (Non-covered public pensions are pensions derived from work where Social Security taxes were not deducted.) The WEP reduced benefits based on an individual’s own work record. Here’s an example of how the WEP could have negatively impacted a retiree’s benefits: Let’s say a teacher’s payroll did not deduct for Social Security but she also had other jobs (like summer jobs or another career before or after teaching) where payroll did deduct for Social Security. This teacher, up until the SSFA, could not collect Social Security even though, through her non-teaching jobs, she had paid into it. Now she’ll be able to.
 
The second law repealed, the GPO, reduced an individual’s access to spousal or survivor benefits. In other words, assume that a teacher has a non-covered pension. Usually, when a spouse retires or dies, the other spouse (here, our teacher) can collect Social Security based on her retired or deceased spouse. But because our teacher had a non-covered pension (i.e., had not paid into Social Security herself), the GPO would not let her collect benefits based on her spouse’s work record. With the repeal, she will be able to do so.
 
Now that the bill has become law, future retirees will be able to collect their full Social Security benefits (or spousal or survivor benefits) along with their non-covered public pensions. Implementation of the SSFA for current retirees is still being worked out. However, it appears that some retirees whose benefits had been reduced by the WEP and the GPO will receive retroactive payments from January 2024 onward.
 
According to the Social Security Administration, current retirees do not need to take any immediate action. For the most reliable and up to date information, please visit (and continually revisit) Social Security’s dedicated SSFA page.
 
Until next time, take care…