My wife filed for SS benefits at FRA, subject to WEP. I filed for spousal benefits on her record and am receiving half of her penalized amount.This year, I will file for my own benefits at 70, and she will file for spousal benefits on my record. How will they calculate her benefit with regard to GPO and Excess Spousal Benefits?

Hi,

I'll explain with an example. Say Mary's full retirement age rate (PIA) on her own record is $500 using the modified Windfall Elimination Provision (WEP) computation formula (https://www.ssa.gov/pubs/EN-05-10045.pdf). Mary starts drawing her benefits at her full retirement age (FRA), so she is paid her full rate of $500.

Mary's husband subsequently files for benefits on his record and his PIA is $2600. Mary's excess spousal benefit would be calculated by subtracting her PIA from 50% of her husband's PIA, which in this case would be $800 (i.e. $2600/2 - $500). However, Mary is receiving a government pension based on her work that was exempt from Social Security taxes, so her spousal benefits are subject to the Government Pension Offset (GPO) provision (https://www.ssa.gov/pubs/EN-05-10007.pdf). So, if Mary's government pension amount is $900 for example, 2/3rds of that or $600 would be withheld from her spousal rate. The remaining spousal benefit of $200 (i.e. $800 - $600) would then be paid in addition to her own retirement rate of $500, giving Mary a combined benefit rate of $700.

Best, Jerry