I am going to be hit with the Windfall Provision when I file for social security. I am currently at FRA however I recently found out that by delaying my filing date to get the 8% annual increase the Windfall Provision also goes up.
I have been unable to find out how much WEP will increase each year. I have used the your Software but that doesn't clearly spell this out. Will the Windfall increase cancel out the 8% increase? Is it worth delaying filing only to have the Windfall increase? Thanks

Hi,

Waiting past full retirement age (FRA) to start drawing your benefits wouldn't have any impact on the amount of any WEP (Windfall Elimination Provision) reduction applied to your benefit rate. Any WEP reduction is applied to the person's primary insurance amount (PIA), which is equal to their Social Security retirement benefit rate if they start drawing their benefits at full retirement age (FRA).

If you wait past FRA to claim your benefits, Social Security would first calculate your WEP adjusted PIA. They would then apply any increase resulting from delayed retirement credits (DRC) to your WEP adjusted PIA.

For example, say Joe's FRA is age 66 and his PIA before WEP would be $1,400. However, since Joe is receiving a pension based on his earnings that were exempt from Social Security taxes, Joe's PIA is reduced by WEP to $1,000. If Joe waits until age 70 to start drawing his benefits, he would receive 4 years of DRCs at 8% per year. The DRCs would be applied to Joe's WEP reduced PIA to give him a monthly benefit rate of $1,320, or 32% more than than the $1,000 he would have received if he'd started drawing at FRA.

Our software (https://maximizemysocialsecurity.com/purchase) is fully programmed to handle WEP computations, so you may want to strongly consider using the software to fully analyze the options available to you in order to determine your best strategy for maximizing your benefits.

Best, Jerry