(over)

Windfall Elimination Provision

2017

Windfall Elimination Provision

Your Social Security retirement or 

disability benefits can be reduced

The Windfall Elimination Provision can affect how we 

calculate your retirement or disability benefit. If you work 

for an employer who doesn’t withhold Social Security 

taxes from your salary, such as a government agency 

or an employer in another country, any retirement or 

disability pension you get from that work can reduce your 

Social Security benefits.

When your benefits can be affected

This provision can affect you when you earn a retirement 

or disability pension from an employer who didn’t withhold 

Social Security taxes and you qualify for Social Security 

retirement or disability benefits from work in other jobs for 

which you did pay taxes.

The Windfall Elimination Provision can apply if:

• You reached 62 after 1985; or

• You became disabled after 1985; and

• You first became eligible for a monthly pension based 

on work where you didn’t pay Social Security taxes 

after 1985. This rule applies even if you’re still working.

This provision also affects Social Security benefits for 

people who performed federal service under the Civil 

Service Retirement System (CSRS) after 1956. We won’t 

reduce your Social Security benefit amounts if you only 

performed federal service under a system such as the 

Federal Employees’ Retirement System (FERS). Social 

Security taxes are withheld for workers under FERS.

How it works

Social Security benefits are intended to replace only 

some of a worker’s pre-retirement earnings.

We base your Social Security benefit on your average 

monthly earnings adjusted for average wage growth. We 

separate your average earnings into three amounts and 

multiply the amounts using three factors to compute your 

full Primary Insurance Amount (PIA). For example, for a 

worker who turns 62 in 2017, the first $885 of average 

monthly earnings is multiplied by 90 percent; earnings 

between $885 and $5,336 by 32 percent; and the balance 

by 15 percent. The sum of the three amounts equals the 

PIA which is then decreased or increased depending 

on whether the worker starts benefits before or after full 

retirement age (FRA). This formula produces the monthly 

payment amount.

When we apply this formula, the percentage of career 

average earnings paid to lower-paid workers is greater 

than higher-paid workers. For example, workers age 62 

in 2017, with average earnings of $3,000 per month could 

receive a benefit at FRA of $1,473 (49 percent) of their 

pre-retirement earnings increased by applicable cost of 

living adjustments (COLAs). For a worker with average 

earnings of $8,000 per month, the benefit starting at FRA 

could be $2,620 (32 percent) plus COLAs. However, if 

either of these workers start benefits earlier, we’ll reduce 

their monthly benefit.

Why we use a different formula

Before 1983, people whose primary job wasn’t covered 

by Social Security had their Social Security benefits 

calculated as if they were long-term, low-wage workers. 

They had the advantage of receiving a Social Security 

benefit representing a higher percentage of their 

earnings, plus a pension from a job for which they didn’t 

pay Social Security taxes. Congress passed the Windfall 

Elimination Provision to remove that advantage.

Under the provision, we reduce the 90 percent factor in 

our formula and phase it in for workers who reached age 

62 or became disabled between 1986 and 1989. For 

people who reach 62 or became disabled in 1990 or later, 

we reduce the 90 percent factor to as little as 40 percent.

Some exceptions

The Windfall Elimination Provision doesn’t apply if:

• You’re a federal worker first hired after 

December 31, 1983;

• You were employed on December 31, 1983, by a 

nonprofit organization that didn’t withhold Social 

Security taxes from your pay at first, but then began 

withholding Social Security taxes;

• Your only pension is for railroad employment;

• The only work you performed for which you didn’t pay 

Social Security taxes was before 1957; or

• You have 30 or more years of substantial earnings 

under Social Security.

SocialSecurity.gov
The Windfall Elimination Provision doesn’t apply 

to survivors benefits. We may reduce widows or 

widowers benefits because of another law. For more 

information, read Government Pension Offset

(Publication No. 05-10007).

Social Security years of 

substantial earnings

If you have 30 or more years of substantial earnings, 

we don’t reduce the standard 90 percent factor in our 

formula. See the first table that lists substantial earnings 

for each year.

The second table shows the percentage used to 

reduce the 90 percent factor depending on the number 

of years of substantial earnings. If you have 21 to 29 

years of substantial earnings, we reduce the 90 percent 

factor to between 45 and 85 percent. To see the 

maximum amount we could reduce your benefit, visit 

www.socialsecurity.gov/retire2/wep-chart.htm.

A guarantee

The law protects you if you get a low pension. We won’t 

reduce your Social Security benefit more than half of your 

pension for earnings after 1956 on which you didn’t pay 

Social Security taxes.

Contacting Social Security 

The most convenient way to contact us anytime, 

anywhere is to visit www.socialsecurity.gov. There, 

you can: apply for benefits; open a my Social Security

account, which you can use to review your Social Security 

Statement, verify your earnings, print a benefit verification 

letter, change your direct deposit information, request 

a replacement Medicare card, and get a replacement 

1099/1042S; obtain valuable information; find 

publications; get answers to frequently asked questions; 

and much more.

If you don’t have access to the internet, we offer many 

automated services by telephone, 24 hours a day, 

7 days a week. Call us toll-free at 1-800-772-1213 or at 

our TTY number, 1-800-325-0778, if you’re deaf or hard 

of hearing.

If you need to speak to a person, we can answer your 

calls from 7 a.m. to 7 p.m., Monday through Friday. We 

ask for your patience during busy periods since you may 

experience higher than usual rate of busy signals and 

longer hold times to speak to us. We look forward to 

serving you.

Year Substantial earnings

1937–1954 $900

1955–1958 $1,050

1959–1965 $1,200

1966–1967 $1,650

1968–1971 $1,950

1972 $2,250

1973 $2,700

1974 $3,300

1975 $3,525

1976 $3,825

1977 $4,125

1978 $4,425

1979 $4,725

1980 $5,100

1981 $5,550

1982 $6,075

1983 $6,675

1984 $7,050

1985 $7,425

1986 $7,875

1987 $8,175

1988 $8,400

1989 $8,925

1990 $9,525

Year Substantial earnings

1991 $9,900

1992 $10,350

1993 $10,725

1994 $11,250

1995 $11,325

1996 $11,625

1997 $12,150

1998 $12,675

1999 $13,425

2000 $14,175

2001 $14,925

2002 $15,750

2003 $16,125

2004 $16,275

2005 $16,725

2006 $17,475

2007 $18,150

2008 $18,975

2009–2011 $19,800

2012 $20,475

2013 $21,075

2014 $21,750

2015-2016 $22,050

2017 $23,625

Years of substantial

earnings Percentage

30 or more 90 percent

29 85 percent

28 80 percent

27 75 percent

26 70 percent

25 65 percent

24 60 percent

23 55 percent

22 50 percent

21 45 percent

20 or less 40 percent

Social Security Administration

Publication No. 05-10045 | ICN 460275 | Unit of Issue — HD (one hundred)

January 2017 (Recycle prior editions)

Windfall Elimination Provision

Produced and published at U.S. taxpayer expense

Printed on recycled paper