The Windfall Elimination Provision (WEP) was a Social Security rule that could reduce retirement or disability benefits for individuals who also received a pension from work not covered by Social Security, according to the Social Security Administration (SSA). This rule, enacted in 1983, primarily affected state and local government employees who didn’t pay Social Security payroll taxes on their earnings, says a House Ways and Means Committee hearing. The WEP was designed to prevent individuals from receiving Social Security benefits based on work where they didn’t contribute to the system, explains the SSA.
The WEP worked by reducing the Social Security benefit calculation, which could lead to a significant reduction in the monthly benefit amount. However, the WEP was repealed by the Social Security Fairness Act, signed into law on January 5, 2025, states CalPERS. As a result, individuals who were previously affected by WEP may now receive higher monthly benefits and retroactive payments for the time their benefits were reduced, notes a Social Security blog post.
For those who are still uncertain about how the repeal of WEP impacts their benefits, the SSA is providing information and guidance on the changes and the process for adjustments, says the SSA.
https://www.ssa.gov/benefits/retirement/social-security-fairness-act.html