I work for a school district and do not pay into Social Security. I am presently receiving deceased spousal benefits. I want to retire but I hear my benefits will be reduced by 2/3%. Is that true? Is there anything that I can do so that will not happen?

Hi,

Yes, it sounds like the Government Pension Offset provision (GPO) would apply in your case. If you become eligible for a pension from a government agency in the U.S. (including state or local/county school districts) that is based on your earnings that were exempt from Social Security taxes, then your Social Security survivor benefits will likely be reduced by 2/3rds of the amount of your school district pension. For more information on the GPO, see the following pamphlet: https://www.ssa.gov/pubs/EN-05-10007.pdf.

Probably the only way to avoid this reduction would be to not take your school district pension, but that would likely just be shooting yourself in the foot. You will probably be better off taking the pension, since the total amount you would get between Social Security and your pension would still be more than just your Social Security alone. If, however, the amount of your pension from the school district will increase if you defer taking it until a later age, it may pay you to delay starting the pension.

You may wish to consider running the maximization software available on this website. It is programmed to handle both GPO and WEP (https://www.ssa.gov/pubs/EN-05-10045.pdf) cases, so it may be able to help you determine your best course of action.

Best, Jerry

Best, Jerry