Social Security Fairness Act Restores Benefits for Millions of Public Servants

The Social Security Fairness Act was signed into law on January 5, 2025, repealing the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO), which reduces Social Security benefits for workers that receive a pension and do not have Social Security taxes withheld from their salaries. This is the first time in 20 years that Social Security benefits were enhanced.

Changes to Social Security

This change impacts millions of people, from federal employees, state and municipal workers, university employees, and teachers, to firefighters, police officers, transit workers, and more.

The WEP and GPO provisions were previously used to reduce Social Security benefits for individuals receiving “non-covered pensions” (pensions from employers that do not pay into Social Security). Now, with these provisions repealed, millions of workers will see higher monthly Social Security payments.

Surviving spouses who receive widow or widower benefits are also included in this change. And the Congressional Budget Office (CBO) estimated that eliminating these provisions will increase monthly benefits by an average of $1,190 for 390,000 surviving spouses. This law is also retroactive to January 1, 2024.

Examples of Impact

Here are two scenarios to help explain how this change affects workers:

Example 1: A State Worker Who Never Worked a Social Security Job

• Before the Act: If the state worker never paid into Social Security, they would not receive any Social Security benefits. Their surviving spouse would also have their survivor benefits reduced by two-thirds of the state worker’s monthly pension payments.
• After the Act: While the state worker still does not receive Social Security benefits because they never paid into the system, their spouse’s survivor benefits are no longer reduced.

Example 2: A State Worker Who Worked a Job that Paid into Social Security

• Before the Act: The state worker’s Social Security benefits were reduced because they also received a public pension. Additionally, their spouse’s spousal benefits were either reduced or eliminated.
• After the Act: The state worker’s Social Security benefits are no longer reduced. Their spouse now receives full spousal benefits.

A Note of Caution

While this new law is a step forward for public servants, it raises questions about the long-term stability of Social Security. According to the 2024 Old-Age, Survivors, and Disability Insurance (OASDI) Trustees Report on Social Security and Medicare , the trust fund will not be able to pay full benefits starting in 2035. With the Social Security Fairness Act now in place, this date is expected to move up by about six months. Similar concerns have come up in the past, leading to reforms to ensure the program’s longevity. Future adjustments may be necessary to address these funding challenges.

Main Takeaways

By repealing the WEP and GPO, the Social Security Fairness Act provides much-needed financial relief to individuals. However, it also highlights the importance of continuing efforts to secure the long-term sustainability of Social Security for future generations. Contact our team to learn more about this change and to discuss your financial planning goals with our professionals.