My wife are both British having lived in the US since 1989. We are both US Citizens now. I am 67 years old and my wife is 66 years 2 months. I receive a US Social security pension and a UK state pension. The US SS benefits are reduced due to WEP which I get. My wife has never worked in the US and has applied for Spousal benefits in the US. She also receives a UK State Pension. She received a letter from the Social Security Administration detailing her entitlement. However we are confused as the amount has been reduced by two-thirds which would imply the Government Pension Offset has been applied. I thought that only applied to federal, state, or local government workers not an overseas pension.

Hi. You're absolutely correct that the only types of government pensions that count for Government Pension Offset (GPO) purposes are pensions that a person receives from working for a governmental agency in the U.S. If your wife's spousal benefits are being offset because of a pension that she's receiving from working in the U.K. then that has to be a mistake. Section B in the following reference from Social Security's operations manual clearly states that foreign pensions are excluded from the definition of a pension for GPO purposes: https://secure.ssa.gov/apps10/poms.nsf/lnx/0202608400.

It sounds like your wife should file an appeal with Social Security. The instructions for doing so can be found in the following Social Security publication: https://www.ssa.gov/pubs/EN-05-10058.pdf.

Best, Jerry