Will I Be Exempt From, Or Subject To, A WEP Deduction?

Sep 4 2019 - 7:07am

I have paid in my 40+ quarters of SS contributions. But, I also worked for an international organization overseas for several years without making SS contributions. I now receive a pension paid by this organization that exceeds the WEP threshold. When I file for my SS benefits, will I be exempt from, or subject, to, a WEP deduction? My pension has a non-US origin. Thank you.

Hi,

The fact that your pension is from a non-U.S. source would not exclude it from causing your benefit rate to be reduced due to the Windfall Elimination Provision (WEP). Since the pension is based on your work earnings and since you did not pay Social Security taxes on those earnings, it's likely that your Social Security retirement benefit rate will be affected by WEP.

When WEP applies, Social Security retirement benefits are calculated using a less generous benefit computation formula. However, there is a WEP guarantee provision that limits any resulting reduction in your Social Security rate to no more than half of the amount of your non-covered pension. For more information on WEP and it's exceptions, refer to the following Social Security publication: https://www.ssa.gov/pubs/EN-05-10045.pdf.

Our software (https://maximizemysocialsecurity.com/purchase) is fully programmed to handle WEP computations, so you may want to use it to get an accurate estimate of your benefit rate and to determine your best strategy for claiming your Social Security benefits.

Best, Jerry