2.8 Million Americans Are Owed Back Social Security Benefits. Will You Get Yours Anytime Soon?

Bills proposing Social Security changes aren't unusual in Congress. With the program less than a decade from potential insolvency, those in government are frequently floating new strategies for how to increase its funding before benefit cuts become necessary. Usually, these bills don't go anywhere, but an interesting one just landed on President Biden's desk.

It has nothing to do with Social Security's funding crisis. Instead, the Social Security Fairness Act will increase benefits for 2.8 million Americans that some say have had their checks unfairly reduced over the years. As a result, these seniors are now entitled to back pay. Here's what we know so far.

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The Social Security Fairness Act targets two provisions that primarily affected government workers

The Social Security Fairness Act eliminated two Social Security provisions: the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). Both were similar in purpose, but the WEP targeted retired workers while the GPO focused on the spouses of those retired workers.

These provisions reduced the benefits of workers who received "non-covered pensions" -- that is, pensions paid by an employer that didn't withhold money from Social Security. You see this with government employees, like teachers and police officers. It essentially altered their Social Security benefit formula to reduce the size of their checks because they didn't pay as much in payroll taxes over the years.

Now that it's been repealed, these individuals will receive larger Social Security checks going forward because their benefits will be calculated in the same way as the benefits of typical retired workers.

Even better for these retirees is the fact that the law applies to all benefits issued after December 2023. So affected seniors who claimed benefits last year are entitled to back Social Security benefits.

Some big questions remained unanswered

Now that President Biden has signed the act into law, we know that affected seniors will receive additional benefits. But there are a lot of details that still have to be worked out. It's expected that the average retiree affected by this will receive about $360 more per month. But everyone will get something different. It depends on your income throughout your working years and how much the government withheld from you under the WEP or GPO.

If you qualified for a $360 monthly increase, you'd be owed about $4,320 in back pay if you claimed benefits for all of 2024. But again, this amount will vary by person.

So far, the government hasn't made plans for when or how it will implement the new Social Security Fairness Act requirements. It'll likely be up to the incoming Trump administration to figure out the logistics, so it could be a little while before you see any of that money.

The Social Security Administration (SSA) will likely keep affected beneficiaries apprised of the situation. For now, its only guidance is to ensure that the SSA has your current mailing address and direct deposit information on hand. You can update this in your my Social Security account or by calling or visiting your local Social Security office.

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