Hi Larry,

I worked in the US and contributed/paid to SS for 28 years. Subsequently, I worked in London for about 7 years where I contributed to the equivalent of our 401K in the US and I directed where the funds were invested. In the UK, we termed this as pension. I do not get monthly payments from this pot but I intend to withdraw a lump sum every so often. So far, I have drawn a lump sum only once, last year. Would this "pension" be subject to the Windfall Elimination Provision and if so, how would it be assessed since I do receive periodic monthly payments, only occasional lump sum?

Thank you very much for your help

regards,
Jerry

Hi Jerry. It sounds like the plan to which you refer would almost certainly be considered as a pension for purposes of the Windfall Elimination Provision (WEP). When the employee has discretion on how funds from a pension plan are distributed, Social Security uses a proration formula to convert the total amount in the fund into a monthly rate (https://secure.ssa.gov/apps10/poms.nsf/lnx/0300605364).

However, depending on how many of your U.S. earnings years were 'substantial' by WEP standards, you may have worked long enough in the U.S. to lessen the impact of WEP. Substantial earnings amounts by year are listed on page 2 of the following Social Security publication: https://www.ssa.gov/pubs/EN-05-10045.pdf.

Our software is fully programmed to handle WEP computations, so you should strongly consider using the software (https://maximizemysocialsecurity.com/purchase) to determine how WEP may affect your benefit rate, and to compare and analyze all of your options so that you can determine your best strategy for maximizing your benefits.

Best, Jerry