The Windfall Elimination Provision (WEP) is a rule that can reduce Social Security benefits for individuals who also receive a pension based on work where Social Security taxes were not paid, such as some government jobs. For example, a retired teacher receiving a state pension might see their Social Security benefits reduced due to this provision.
Understanding the impact of the WEP is crucial for affected individuals to plan their retirement finances effectively. The WEP has been a subject of ongoing debate, with discussions focusing on its fairness and potential reforms. Its origins lie in attempts to prevent individuals from receiving disproportionately high Social Security benefits relative to their lifetime earnings.
