I have a client with a 414h2 plan from a county hospital where she didn't pay into social security. Someone told her that if she moved that plan to an IRA, it would qualify as WEP and reduce her social security benefit. She has asked social security and has been given different answers. Any help you can provide is appreciated.

Hi,

I'm not familiar with 414h2 plans, but if your client collects a pension, or payment(s) in lieu of a pension, that's based on work and earnings that weren't subject to Social Security taxes, then her Social Security retirement or disability benefits may be reduced due to the Windfall Elimination Provision (WEP). Disbursements from a defined contribution plan can cause such a reduction regardless of whether or not the money is moved to an IRA. For more detailed information, refer to the following section of Social Security's operations manual: https://secure.ssa.gov/apps10/poms.nsf/lnx/0300605364#a3.

Best, Jerry