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What is the Windfall Elimination Provision?

Those who have suffered a disability and are therefore unable to work need to understand the Social Security disability process, as they may be entitled to much needed compensation. In addition to wondering if they qualify for SSD benefits, many individuals question how much money they will receive if deemed eligible. The answer is that it really depends on the circumstances at hand. An individual who receives other government benefits, for example, will likely have their SSD benefits reduced.

One way that an individual's Social Security disability benefits can be affected is via the Windfall Elimination Provision. This provision states that should those who work for an employer who does not withhold Social Security taxes receive a pension from that employer, then their Social Security benefits can be reduced. The provision kicks in if other circumstances exist in addition to that stated previously, including a disability was suffered after 1985 and the individual became eligible for their monthly pension after 1985. The rule can apply even if the individual is still working.

How does this provision work? The amount of disability benefits an individual receives is based on his or her income. For example, a worker will typically receive 90 percent of his or her first $856 of monthly earnings, then 32 percent of monthly earnings up to $5,157. Any amount made beyond that will be recouped by 15 percent. However, those who receive a pension from an employer who did not withhold Social Security taxes used to receive the 90 percent of their average monthly earnings in addition to their pension. The Windfall Elimination Period sought to remedy this apparent discrepancy by reducing the amount of SSD received to as little as 40 percent.

Those who have become disabled and need assistance proving their disability may need help from a legal professional. In addition, these individuals may want to consider seeking help if they have concerns about their benefit amount or how it could change in the future.

Source: Social Security Administration, "Windfall Elimination Provision," accessed on Dec. 4, 2016

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Alan E. DeWoskin, P.C.
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