The Windfall Elimination Provision (WEP) applies to Social Security recipients who have their own retirement savings as well as a pension from an employer who did not pay into Social Security. The purpose of WEP is to disallow for the collection of full Social Security benefits when a retiree has retirement savings and a pension from employers who opted out of Social Security (commonly local government). Read on to see if you could have your Social Security benefits reduced by the Windfall Elimination Provision.
Have you worked for an employer that did not withhold for Social Security (such as a govt. agency)?
If you have not, then the WEP does not apply to you and will be eligible for full Social Security benefits. If “yes,” then move on to the next question.
Do you qualify for Social Security benefits from work you did in previous jobs?
If not, then you will not be subject to the WEP. If you have, move on.
Are you a federal worker in the FERS retirement system and first hired after 12/31/1983?
If you are a federal worker who meets the conditions outlined above, you will not be subject to WEP. If you are not a federal worker or are a federal worker and do not meet the above conditions, you may be subject to the Windfall Elimination Provision.
The Social Security Windfall Elimination Provision is complicated and has a large influence on your retirement situation should it affect you. Check out this flowchart to learn more.
If you would like to schedule a call to talk the Social Security Windfall Elimination Provision to see if it affects you, please give us a call at 303-440-2906 or click here here to schedule a time to speak with us.
Robert J. Pyle, CFP®, CFA is president of Diversified Asset Management, Inc. (DAMI). DAMI is licensed as an investment adviser with the State of Colorado Division of Securities, and its investment advisory representatives are licensed by the State of Colorado. DAMI will only transact business in other states to the extent DAMI has made the requisite notice filings or obtained the necessary licensing in such state. No follow up or individualized responses to persons in other jurisdictions that involve either rendering or attempting to render personalized investment advice for compensation will be made absent compliance with applicable legal requirements, or an applicable exemption or exclusion. It does not constitute investment or tax advice. To contact Robert, call 303-440-2906 or e-mail firstname.lastname@example.org.
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