Many people rely on their Social Security and public pension to get them through their senior years. However, retirees have not been able to claim their full Social Security benefits if they had a public pension. Thankfully, that has now changed.
Thanks to legislation passed in 2025, people no longer have to worry about how state pensions impact social security. Congress passed the Social Security Fairness Act, which allows a person to claim their public pension and their full Social Security benefit. They paid into both systems and deserve to receive funds from both.
Who May Collect a Public Pension and Social Security?
Individuals may spend part of their working years in government and part in the private sector. Government employees often don’t pay Social Security payroll tax. When they enter the private sector, they are required to pay this tax. As a result, they receive funds from their pension and Social Security. However, the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) would reduce their Social Security benefit. That has changed with the passage of this legislation.
The Social Security Fairness Act
The Social Security Fairness Act of 2023 is legislation that fully repeals the WEP and GPO. It was signed into law on January 5, 2025, and will apply to any benefits payable after December 2023. Millions of retirees have now received retroactive payments for benefits they were owed in 2024 and 2025 and are seeing a monthly benefit increase starting with their April 2025 payment.
The Financial Consequences
Retirees benefit from the passage of this law, but some financial experts worry that the Old-Age and Survivors Insurance (OASI) Trust Fund won’t last another ten years. Thanks to the passage of this law, they believe the trust fund will be depleted approximately six months sooner than previous estimates. However, they also point out that the government may save on the Supplemental Nutrition Assistance Program (SNAP), as the increased benefits would make some people ineligible for this program.
How This Law Works
Individuals who paid into the Social Security system for less than 30 years used to see a reduction in their benefits if they also received a state pension that didn’t deduct Social Security taxes. The GPO would reduce the benefits of the recipient or their surviving spouse if they received a pension that was based on non-covered employment. People viewed this as a public pension penalty.
Imagine a person who began working for the government at 22, upon obtaining their college degree. They then worked in that job for 20 years before transitioning to the private sector, where they worked until they reached retirement age. Although they paid into the Social Security system from the age of 42 until 65, their benefits would be offset because they received a pension from their 20 years in public service. The Social Security Fairness Act ensures they receive full benefits regardless of where they worked and for how long.
Individuals who previously saw a reduction in their benefits because of the WEP will find their monthly benefits increase hundreds of dollars on average. Those impacted by the GPO will see a higher increase, possibly of $1,000 or more. Seniors need funds to live their final years in dignity, and the Social Security Fairness Act ensures that those who receive funds from Social Security and a public pension will.