Hello;

How about a little out of ordinary few Questions :)

I am a US expat living and working in UK since 1996, came over with a job transfer, stayed. I paid 19 full years of substantial earning taxes and soc sec in the states, and after that i paid my taxes of roughly 23 years here in UK. I always filed both US and UK tax returns, it is the law to do so. As foreign earned income is subject to exclusion by IRS (in recent years in the $70K per year exclusion amount) the net income amounts reported on my US incomes were being reduced to none and therefore not subject to any taxes nor soc sec payments. I did pay UK related taxes on my earning of course.

Come October 2019, I reach 66 years of age, wanted to start claiming Soc Sec benefits and my UK State pension (roughly $500 per month), but while on the US Soc Sec site came across the WEP (windfall exclusion provision) which basically states if you collect Pension elsewhere ( in my case UK), my soc sec benefits can be reduced up to $467 per month.

The UK state pension amount is not large as I noted above ( roughly $500 a month), but it appears that I am being penalized by that WEP provision for not having worked in the States for 30 years or for having paid taxes and soc sec to UK , even though I lived and worked in a country that has multiples of treaties relating to not paying double taxes nor soc sec to both countries.

Main Question :
Anything I can do/look into to somehow overcome this:
- any treaty of sorts so I can have Soc Sec office consider my 23 UK work years towards my US 19 years with Substantial Earnings so it would be over the 30 years minimum?
- Any Appeal possibilities that may cover similar cases which would permit me to collect both ?
- other ideas?

Thank you and kind regards;
Mike

HI Mike,

Based on your description it sounds like your U.S. Social Security retirement benefits will be adversely affected by the Windfall Elimination Provision (WEP), and there's probably no way to avoid that in the long term. Your U.S. benefits wouldn't be subject to a WEP reduction until you actually claim your UK benefits, though, so you could temporarily avoid WEP by starting your UK benefits later than your U.S. benefits. That may not be a good strategy, though.

I assume that you have no plans to return to the U.S. and resume working here, but if you did you might be able to reduce the effects of WEP if you end up with more than 20 years of substantial earnings as defined in the WEP provision (https://www.ssa.gov/pubs/EN-05-10045.pdf). Only earnings on which you pay U.S. Social Security taxes can count toward meeting the substantial earnings provision, though, not your UK earnings. You need 30 years of substantial U.S. earnings to be fully exempt from WEP, but the WEP reduction rate is reduced incrementally for each year of substantial earnings in excess of 20 years.

There is a WEP guarantee provision that limits the amount of reduction caused by WEP to a maximum of no more than half of the amount of your non-U.S. Social Security covered pension, so if your UK pension is small then the effect that WEP will have on your U.S. benefits may not be as bad as you're anticipating. Our software (https://maximizemysocialsecurity.com/purchase) is fully programmed to handle WEP calculations, so you may want to strongly consider using it to determine your best overall strategy for claiming your benefits.

Best, Jerry