News

Congress repeals Social Security Windfall Elimination Provision (WEP)

Jan. 11, 2025
President Joe signed the Social Security Fairness Act into law on January 5, 2025, eliminating the Windfall Elimination Provision (WEP). This longstanding reduction had affected individuals receiving both U.S. Social Security benefits and pensions from work not covered by Social Security. The legislation passed with strong bipartisan support in both chambers of Congress. The text of the law can be accessed here.

The repeal of the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) will potentially significantly increase Social Security benefits for affected individuals:

• WEP-affected retirees will see an average increase of $360 per month in their Social Security benefits.
• GPO-affected spouses will receive an average monthly increase between $700-$1,190.
• Beneficiaries will receive retroactive payments for benefits missed in 2024.

The exact impact on monthly benefits will vary, based on the taxpayer's individual employment history and circumstances. To prepare for these changes:

• Ensure your current mailing address and direct deposit information are up to date in your Social Security account.
• No immediate action is required; the Social Security Administration will implement the changes automatically.
• If you have specific questions about how the repeal affects your individual benefits, contact the Social Security Administration directly.

US taxpayers who received both Social Security benefits and Japanese pension benefits were often subject to a significant WEP reduction of their U.S. Social Security benefits. As of the passage of this Act, this is no longer the case, and all WEP reductions made since the start of 2024 will be retroactively refunded via a lump-sum payment at some future date. It is not yet clear when WEP reductions will be halted, or when the retroactive lump-sum payment will be made. Nevertheless, this is welcome news for Japan-resident expats previously subject to the WEP reduction of their Social Security benefits.