What people get when they retire from Social Security will change, and some people may not like how the changes affect them. Get rid of the Windfall Elimination Provision (WEP), which would affect a lot of retirees. This is one of the changes that might cause the most debate.
The Social Security Administration (SSA) says that the Worker Earnings Parameter (WEP) is a way to change Social Security worker benefits for people who get “non-covered pensions” but are still eligible for benefits because they have other Social Security-covered earnings.
A non-covered pension is one that is paid by a company that does not take Social Security taxes out of your pay. This usually includes state and local governments or companies that are not based in the United States.
This means that the WEP is meant to make payments equal for people who get pensions but haven’t paid into the system through taxes, while lowering payments for people who haven’t worked the full 35 years needed to get the maximum retirement benefit.
This is because everyone knows that the pension will make up for the money a person should have gotten after working their whole life.
This can hurt people who have worked in both the private and public sectors, or in both pensioned and non-pensioned jobs, over the course of their lifetime, because their benefits are sometimes cut even though they have earned credits and should be getting a higher Social Security benefit.
But immigrants are one group that is hit hard by the WEP provision while others are not.
How the WEP affects the Social Security benefits of immigrants
It doesn’t matter if you are an American citizen who lives and works abroad and then retires with a pension or if you are an American resident who has worked abroad and now has rights to benefits both in the United States and abroad. The effect is the same and just as bad.
The website change.org led a petition to get this rule thrown out, and they say that the WEP means that “legal immigrants, U.S. citizens who have worked outside the U.S., and naturalized U.S. citizens who have worked in their home country all have their monthly Social Security pensions significantly reduced because they receive a foreign pension.”
Their Social Security pension could go down by up to $557.50 a month in 2023. People with lower incomes are hit the hardest by the WEP. A lot of these people are foreign pension recipients whose combined income is often at or below the poverty line.
Many lawmakers worked hard to get rid of WEP, and the bill had a lot of support in the House of Representatives, including the Speaker of the House.
Thankfully, this provision and another one that was often used with it, the Government Pension Offset (GPO), which “adjusts Social Security spousal or widow(er) benefits for people who receive “non-covered pensions,” have been taken away.
Reps. Abigail Spanberger (D-Va.) and Garret Graves (R-La.), who are co-leaders of the bill, talked at length about how happy they were that it had finally been passed and that these old parts had been taken out.
Graves said, “This has been 40 years of having different rules for different people and workers.” He said, “They’re not people who are overpaid or underworked.”
Spanberger said on Tuesday in the House that Congress needs to deal with the problem of how to pay for Social Security in the long term. “But that’s not the same thing as letting Americans who did their part and contributed their earnings retire with honor,” she said.
There is still a lot of work to be done to make sure that benefits are enough and cover people’s costs, but ending the WEP is a good start to make sure that people who have worked get what they deserve.
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