Dear Larry,

Before I moved to the United States. I lived and worked in London, England until I was about 27(1972).

I have worked since then 100% in the United States. I began collecting Social Security the age of 70, and also found out that I was eligible to receive a UK pension around the same time. However, I received my US pension before I received the UK pension by about a year and declared my UK pension a few months ago(my birthday is July 1945).

Social Security is currently paying me $1953 a month and want to change it to $1741. My UK pension pays me approximately $200 a month(depending on the value off sterling. Furthermore, they are seeking to claw back $2982.

Originally when applying for Social Security and agent on the telephone asked if I was receiving a UK pension and I said no but I'm in the process of applying and I said, put this cost me any reduction in Social Security. I told him I would receive around $200 and he said it would reduce my so's Social Security benefit by about $50 a month.

My income over the years since I've lived in the United States between 1972 and 1970. I have had about 10 to 15 years of Social Security income and in the last 15 to 20 years. Most of my income has been investment income and I have never received any foreign income since 1972 just want to reiterate that.

Can you help me. Thanks,

Leonard

Hi Leonard,

It sounds like Social Security is probably correct about the UK pension reducing your US Social Security benefit. This is due to the Windfall Elimination Provision (WEP). There are exceptions to WEP, but unless you've had more than 30 years of 'substantial earnings' (https://www.ssa.gov/pubs/EN-05-10045.pdf) in the US, you are probably subject to the WEP reduction. The reduction would be applicable beginning with the month of your entitlement to the UK pension, so if you were paid your full US Social Security benefit for any of those months, Social Security can propose withholding your current benefits to recover the overpayment.

The only other possibility that might exempt you from reduction is if the UK had to credit your US work in order to qualify you for a benefit from their program. If they did, it would be referred to as a totalization benefit, and would be exempt from WEP. On the other hand, if you qualified for the UK pension without regard to your work in the US, the WEP reduction likely applies.

The only remaining question is whether or not the amount of the reduction is correct. It surprises me that the reduction in your case is more than the actual amount of the UK pension, assuming that $200 in US dollars is the correct gross amount. The reduction is normally limited to something closer to half of the gross amount of the foreign pension. The formula for computing the reduction (https://secure.ssa.gov/apps10/poms.nsf/lnx/0300605370) is too complex for me to analyze without access to your Social Security records, though.

You might want to consider appealing the determination to reduce your benefits. That will assure a second set of eyes reviewing all of the data, and there are additional steps of appeal if the first step (reconsideration) is unfavorable. Of course, there is at least a small chance that could result in them finding something that would lower your benefit amount even more, but that rarely occurs. You have only 60 days from the date of the notice of determination in which to file your request for appeal, so you'll need to act timely if you decide to appeal.

Best, Jerry