Like the Windfall Elimination Provision, the Government Pension Offset reduces Social Security benefits. However, unlike the WEP, the GPO only changes Social Security “survivor benefits” that a widow(er) or ex-spouse qualifies for. Specifically, if an individual is receiving a pension earned from their days working in non-covered employment — i.e., if they meet both criteria — then the GPO will change survivor benefits.
How much is the reduction because of the Government Pension Offset? The rule is straightforward:
- Any Social Security survivor benefits that would be paid to a widow(er) or ex-spouse will be reduced by two-thirds of the value of the widow(er) or ex-spouse’s own pension benefit (if that pension was earned while in non-covered employment).
For example, consider a former public school teacher whose husband recently died. He was receiving Social Security benefits, and she is entitled to a portion of these payments as survivor benefits. If this were a normal circumstance, then the value of those survivor benefits would be $2,000 a month. However, this retired teacher worked in a school district that did not participate in Social Security, and she is receiving a monthly pension for her time teaching that is worth $2,700 a month.
Here is how the GPO would change her survivor benefits:
Because the teacher earned a pension from non-covered employment, she cannot collect a full widower benefit from Social Security. In her case, the GPO reduces the widower benefit by two-thirds of $2,700, which is $1,800. The widow would therefore receive a Social Security survivor benefit of $200 a month (which is $2,000 minus $1,800).
Unlike the WEP, the GPO has no limit to the reduction. The GPO can eliminate the spousal or widow(er) Social Security survivor benefit outright.