Social Security Fairness Act: Five Financial Planning Issues to Revisit
More money as a public-sector retiree is great, but there could be unintended consequences with taxes, Medicare and more if you're not careful.


For decades, public-sector retirees with state-backed pensions have faced reductions in their Social Security benefits due to the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).
These provisions were designed to adjust Social Security payments for those receiving government pensions. But now, that’s all changed.
With the passage of the Social Security Fairness Act (SSFA), both WEP and GPO have been repealed. This brings significant financial implications for millions of public-sector retirees.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.

Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The Social Security Fairness Act, summarized
By eliminating both WEP and GPO, the SSFA guarantees that pension-eligible retirees who paid into the Social Security system will receive their full benefits, rather than having them reduced due to their public pension.
This correction helps level the playing field for teachers, firefighters, police officers and other public servants who spent part or all of their careers contributing to Social Security.
Now that we’ve covered the basics, let’s unpack the details.
What the Social Security Fairness Act means for retirees
The SSFA, which was signed into law by President Joe Biden on January 5, 2025, increases Social Security payments for those previously affected by WEP and GPO:
- Employees subject to WEP will see an average increase of $360 per month
- Spouses impacted by GPO can expect an average boost of $700 per month
- Widows or widowers affected by GPO will receive an average increase of $1,190 per month
The new law is retroactive to benefits payable after December 2023, which means that retirees affected by the law will receive a lump sum equal to the value they would’ve received since the start of 2024.
Who benefits from the SSFA?
This change in policy is intended to ensure that public-sector retirees who paid into Social Security during part or all their careers receive the full Social Security benefits they’ve earned, without reductions from the WEP or the GPO.
For example, let’s say Sam is a federal employee who is eligible for a pension, but who also paid into Social Security prior to becoming a federal employee. Previously, WEP would’ve reduced his Social Security benefits to account for this pension income. With the passage of the SSFA, this offset is eliminated.
Similarly, Amanda has just retired after 30 years of teaching. Her husband is a high-earning construction contractor. Previously, she would’ve seen any spousal and survivor benefits reduced by the GPO due to her teacher’s pension. Now, under the new law, she will receive the full benefit amount.
What should you do?
For those who’ve received reduced benefits due to WEP or GPO, the Social Security Administration is automatically adjusting payments and issuing retroactive payments.
Beneficiaries do not need to reapply for Social Security, but they should ensure their mailing address and direct-deposit details are up to date through the SSA website.
Key financial planning considerations for public-sector retirees
Having more money is a good problem to have, but affected retirees need to consider these five potential implications of the SSFA’s passage:
- Tax brackets. Social Security benefits are partially taxable based on income. Higher Social Security payments may push some retirees into a higher tax bracket, or increase the taxable portion of their benefits. Retirees could also move into a higher capital gains tax bracket.
- Medicare costs. Medicare Part B and D premiums are based on income and have a two-year look-back period. Higher Social Security benefits today could push retirees into a higher premium bracket in the future.
- Tax mitigation strategies. The additional income may impact required minimum distributions (RMDs) and Roth conversion strategies.
- Investment taxes. An increase in income may trigger the net investment income tax (NIIT) for individuals with a modified adjusted gross income (MAGI) above $200,000 (single) or $250,000 (married filing jointly).
- Income-based programs. Retirees who were previously eligible for Supplemental Nutrition Assistance Program (SNAP) or other programs could lose their eligibility due to increased income.
Looking ahead: The future of Social Security
The repeal of WEP and GPO represents a major shift in Social Security policy. While this change increases benefits for some public-sector employees, it could also place additional financial strain on Social Security’s trust funds, potentially accelerating the timeline for depletion if no new revenue sources are introduced.
Regardless of the future, the SSFA is law today. Affected individuals should take action as soon as possible by reassessing their retirement plans with the help of an experienced financial adviser.
Related Content
- Social Security Fairness Act Payments Checklist: Nine Things to Know
- How Federal Retirees Can Make SSFA Repeals Work for Them
- The Social Security Fairness Act: Good News for Retirees?
- Five Changes Coming for Social Security in 2025
- Are You Prepared for the Evolution of Retirement?
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Daniel Goodman is a Senior Financial Planner at Wealth Enhancement Group with over 20 years of experience in corporate and personal financial planning. Throughout his career, Daniel has helped individuals and businesses navigate complex financial decisions, focusing on tailored strategies for long-term success. His expertise in investment management and data-driven financial planning enables him to deliver customized solutions that meet clients' unique needs and helps them to achieve their financial goals.
-
I’m Over 65 and Itemize: Can I Claim the New $6,000 ‘Senior Bonus’ Tax Deduction?
Tax Changes If you’re an older adult, a new bonus deduction could provide a valuable tax benefit.
-
Alphabet Stock Pops After Google Antitrust Ruling: What to Know
GOOGL stock is soaring Wednesday after a judge ruled that Alphabet does not have to divest its Chrome browser.
-
Alphabet Stock Pops After Google Antitrust Ruling: What to Know
GOOGL stock is soaring Wednesday after a judge ruled that Alphabet does not have to divest its Chrome browser.
-
7 Mistakes to Avoid When You First Start Investing
Investing brings the opportunity to build wealth, but there are plenty of mistakes that can be made. Here are seven common ones and how they can be avoided.
-
A Fidelity Fund Misses Out on Soaring Bank Stocks
The Fidelity International Growth Fund has outperformed over the long term, but its lagging exposure to bank stocks has weighed on more recent returns.
-
More Than Money: The Hidden Toll of Financial Abuse of Older Adults
Financial abuse from schemes involving tech support, government impostors, false sweepstakes, grandchild hoaxes and online shopping issues can cause thousands of dollars in losses.
-
I'm a Financial Planner: Here Are Three High-Impact Ways to Make a Difference With Your Dollars
The world often feels out of control, but here are three ways to use your money — through investments, charitable giving and political donations — to help create a more just and sustainable future.
-
Stocks Slide to Start September: Stock Market Today
Seasonal trends suggest tough times for the stock market as we round into the end of the third quarter.
-
If You'd Put $1,000 Into Sherwin-Williams Stock 20 Years Ago, Here's What You'd Have Today
Sherwin-Williams stock has clobbered the broader market by a wide margin for a long time.
-
Where is the Foreign Dividend Boom Headed?
It's been a golden six months for foreign dividend stocks, but can any be relied on for predictable income going forward? Here are some options.