Hi Larry,

I have a question regarding GPO and my survivor benefits. Would it be in my best interest to INSTEAD OF fully retiring from my teacher retirement system and receiving my pension with reduced survivor benefits - I take out all my pension contributions (yes, I know it will be taxed) and then quitting before I reach retirement age? If I did that, would I still be able to receive my full survivor social security benefits and keep my retirement contributions? TIA

Hi. I don't know if you'd be better off doing what you propose because I don't know how much you'd be forfeiting by giving up your right to a teacher's pension. What I can tell you is that if you withdraw your pension contributions and forfeit all rights to a pension, then the withdrawal wouldn't affect your Social Security survivor benefits.

Here is how Social Security's operation's manual explains withdrawals:
a. Withdrawals from a defined benefit plan, before or after eligibility for the pension, of only employee contributions plus any interest (i.e., none of the employer contributions are included in the withdrawal), and whereby the employee forfeits all rights to a pension, are not pensions for GPO (Government Pension Offset) purposes. This rule applies even if the employer paid the employee contributions for the employee (i.e., some employers may pay for the employee’s contribution).
b. Any other separation payment, withdrawal, or refund that consists of both employer and employee contributions from a defined benefit or defined contribution plan is a pension subject to GPO (https://secure.ssa.gov/apps10/poms.nsf/lnx/0202608400).

On the other hand, if you don't withdraw your contributions and collect a teacher's pension that is based on your earnings that were exempt from Social Security taxes, then any Social Security spousal or survivor benefits for which you'd otherwise qualify would almost certainly be offset by 2/3rds of the amount of your monthly teacher's pension.

Our software (https://maximizemysocialsecurity.com/purchase) is programmed to handle calculations involving GPO, so you should strongly consider using the software to fully compare and analyze all of your options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry