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Social Security Administration

The Social Security Administration (SSA) is an independent agency of the United States federal government that administers Social Security, a social insurance program consisting of retirement, disability, and survivors' benefits. To qualify for these benefits, most American workers pay Social Security taxes on their earnings; future benefits are based on the employees' contributions. (Source: Wikipedia)

Perhaps you are working for the SSA or interested in working for the SSA. Here is a forum to share your experience with the SSA.

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Charles1059  
#1 Posted : Monday, August 06, 2012 1:15:09 AM(UTC)
Charles1059

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I applied for social security and was told I am getting an amount far lower than I believed because of the Windfall Elimination rule and it's need to use another way to calculate what one will receive. The problem with the imposition of the WEP is there are 3 exceptions to the rule. The rule applicable to me stipulates that if one worked for an employer that did not deduct social security, but later in your same employment they did deduct social security payments, than one is not subject to the Windfall Elimination. Hence, how does SSA use a different calculation when the regulations say I meet the terms of an exception to the rule. 
GoHuskers  
#2 Posted : Monday, August 06, 2012 2:49:46 AM(UTC)
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All exceptions to WEP can be found in SSA's own Program Operations Manual System (POMS). There is no exception that exactly corresponds to the situation you describe. An explanation of all the exceptions can be found at https://secure.ssa.gov/a...poms.nsf/lnx/0300605362. (If that direct link does not work, you'll need to go to the POMS home page at https://secure.ssa.gov/a.../poms.nsf/Home?readform. Then, click on the Table of Contents tab, then drill down through RS - Retirement and Survivors Insurance, then RS 006: Determination of PIAs and Benefit Amounts, and finally click on RS 00605.362: Windfall Elimination Provision (WEP) Exceptions.)

Are you thinking that you fall under the exception described in RS 00605.362.B.1? It's impossible to tell without knowing your entire work history with the federal government, but this is an exception that very rarely applies. The other possibility might be the "Years of Coverage" exception (the most common one), but it would be rare for your years of coverage to be miscalculated by SSA since the system computes them based on your recorded earnings.

Charles1059  
#3 Posted : Monday, August 06, 2012 3:14:23 AM(UTC)
Charles1059

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Thank you. This is the exception I believe I qualify under.   I started working in 1979. My last 10 years Soc sec was dededucted from my pay.   
You were employed on December 31, 1983, by a nonprofit organization that did not withhold Social Security taxes from your pay at first, but then began withholding Social Security taxes from your pay;
GoHuskers  
#4 Posted : Monday, August 06, 2012 9:23:25 AM(UTC)
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That would be another exemption that not many people qualify for, so I can see where the Field Office could have missed it. You should go ahead and apply for reconsideration if you believe you meet that exception. If you have any correspondence from your old employer explaining when and why they started deducting the FICA taxes (the entire 7.65%, not just the 1.45% Medicare tax) that would help.
Charles1059  
#5 Posted : Monday, August 06, 2012 9:38:20 AM(UTC)
Charles1059

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Thank you. I also have approx 10 years worth of paystubs still to showing the full amount was deducted. I had to retire at age 57 and turned 62 recently.
Fed1969  
#6 Posted : Monday, August 06, 2012 9:55:11 AM(UTC)
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Those switching to FERS from CSRS are still subject to WEP.
Charles1059  
#7 Posted : Tuesday, August 14, 2012 11:08:24 PM(UTC)
Charles1059

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If so, how is SSA able to violate its own guideline? This may be a good class action case since they write:    

Social Security


The Official Website of the U.S. Social Security Administration


The Windfall Elimination Provision does not apply if:


You were
employed on December 31, 1983, by a nonprofit organization that did not
withhold Social Security taxes from your pay at first, but then began withholding Social Security taxes from your pay;


GoHuskers  
#8 Posted : Wednesday, August 15, 2012 1:46:13 AM(UTC)
GoHuskers

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The devil is always in the details. The exception in question is more fully described in SSA's internal instructions (POMS RS 00605.362.B.2) as "An employee of a nonprofit organization who was exempt from Social Security coverage on 12/31/83, and who became covered for the first time as an employee of that organization on 1/1/84 under the mandatory coverage provision of P.L. 98-21, is exempt from WEP for any pension received from that nonprofit organization."


Another section of POMS further explains the type of non-profit organizations that this exception references:

"RS 01901.540 Service for Nonprofit Organizations

Citations:

Public Law 98-21; Regulation No. 4, Section 404.1025

A. Definition – Tax Exempt Nonprofit Organization

As described in section 501(c)(3) of the Internal Revenue Code, an organization may qualify for exemption from Federal income tax if it is organized and operated exclusively for one or more of the following purposes: religious, charitable, scientific, literary, educational, testing for public safety, fostering national or international amateur sports competition (only if none of its activities involve providing athletic facilities or equipment), or the prevention of cruelty to children or animals.

Qualifying organizations include nonprofit old-age homes, parent-teacher associations, charitable hospitals or other charitable organizations, Alumni associations, schools, chapters of the Red Cross or Salvation Army, Boys’ or Girls’ clubs and churches.

B. Policy - Social Security Coverage

1. January 1, 1984 Through Present

Section 102 of the 1983 Social Security Amendments provides mandatory coverage under Social Security for services performed by employees of nonprofit organizations beginning January 1, 1984."

You have to differentiate between government employment and employment by non-profit organizations. Those that switched from CSRS to FERS are federal government employees, not employees of non-profit organizations, and do not fall under that exception to WEP.

As far as that other WEP exception goes, one has to meet the details to the letter for it to apply. Very few individuals would fall under it. "Federal employees who performed service on 1/1/84, and who became newly covered under Social Security on 1/1/84, under the mandatory coverage provision in P.L. 98-21 are exempt from WEP for federal pensions received." A person previously under CSRS who switched to FERS did it at their option. They did not become covered (i.e., be subject to the FICA tax being withheld) based on any mandatory provision. They chose to do so.

Further, there are specific instructions on how to compute WEP when both CSRS and FERS employment are involved. From POMS RS 00605.364.C.6 - "When a pension is based on both Federal Employees’ Retirement System and CSRS service, it is treated as one pension. Because the pension is based on both covered and non-covered service, consider only the portion of the pension for the period of non-covered service in applying WEP. To prorate the pension, see RS 00605.370B.2." And that last cross-reference says:

"When part of the pension is based on covered employment (e.g., FERS service) prorate the pension using the following formula. The amount of pension based on non-covered employment equals the pension amount times the months of non-covered work after 1956 divided by the total months of work used to compute the pension.

NOTE: When prorating the pension, months of non-covered employment after 1956 will be compared with total months of employment. A partial month of non-covered employment is considered a non-covered work month. A partial month of covered employment only is considered a covered work month. A month that contains both covered and non-covered employment is considered a covered work month."

So, if you were a federal employee that switched from CSRS to FERS, WEP does come into play.
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