Thank you for answering my question 10 days ago. Now I have a more 'arcane' question for you that was brought up during a visit to the SSI office. I taught a long term sub for a local school district that participates with the Colorado PERA rather than SSI. I turned 62 on 12/5. I do not plan to teach again in Colorado. If I take the lump sum of $2087 now (I am not currently taking SSI, but may file next year) PERA will match at 50%. If I wait to 65, PERA will match 100%, but I will certainly be taking SSI at that time. Is the impact on my SSI different if I take the PERA now before I file for the SSI? What is the likely impact on the SSI and income tax if I wait till I am 65 to take the PERA in a lump sum? In either case, at this time, our income tax rate is roughly 15%. Thank you in advance.

Hi,

I'm sorry, but I'm not an expert on either PERA nor income taxes. I can tell you that your PERA pension won't affect your Social Security benefits until you start receiving it. Also, lump sum's taken in lieu of a pension are prorated for purposes of the WEP (https://www.ssa.gov/pubs/EN-05-10045.pdf) and GPO (https://www.ssa.gov/pubs/EN-05-10007.pdf) provisions, so going with the lump sum option may not make a significant difference with regard to the effect on your Social Security benefits.

You should probably consider running the maximization software available on this website. It is programmed to handle both WEP and GPO, and it allows you to run 'what-if' scenarios based on the variables that you input. That should help you determine your best overall filing strategy.

Best, Jerry