Hi,

I have 24 years of substantial earnings in SS and received a retirement payment from working overseas for a foreign company. I am 62 and currently work part time in the USA and pay into SS. I plan to file for SS when I turn 66 at my normal retirement age. If I work until I turn 66 and earn above the "substantial earnings" amount each year, will this mitigate the effect of WEP on my SS payments when I file at 66? In other words, when does SS calculate the reduction of the 90% factor to a lower fraction. Do they calculate that the year I turn 62 or on the date I file for full benefits in 2020? Thanks

Hi,

Yes, it will. For other readers, WEP refers to the windfall elimination provision (https://www.ssa.gov/pubs/EN-05-10045.pdf), which may cause people who receive a pension based on work they performed that was exempt from Social Security taxes to receive a lower Social Security benefit.

There is no cutoff age limit for counting the number of years in which you have 'substantial covered earnings'. If you have an additional year of substantial covered earnings, even if it's after you begin receiving Social Security benefits, it could lessen the effect of WEP. However, you must reach at least 21 years of substantial covered earnings in order to reduce the impact of WEP at all. And, if you eventually reach 30 years of substantial covered earnings, you would then be exempt from WEP from that point forward.

You may wish to consider running the maximization software available on this website. It allows you to enter projected future years of earnings, and it is programmed to include the effects of WEP.

Best, Jerry