[JustSomeGuy]

Goal of the programs were to give those not paying social security when covered by pensions equal treatment of a similar salaried social security paying person, not the larger pension benefit plus the entire social security payment. Goal was to give similar total payouts like the pension /social security combination paid the same as the same number of years and same salaried social security tax payer.

The GPO reduction in Social Security benefits is 2/3rds of the monthly amount of the public sector government retirement benefit you receive. Of note, if you receive a lump sum payment from a public sector government pension, the lump sum will be converted into a monthly annuity benefit by Social Security. For example, let’s assume you and your spouse have both reached your full retirement age for Social Security purposes. That would mean you are between the ages of 66-67. Your public sector government pension is $3,000/month and you have no Social Security benefit of your own. As a spouse, you are entitled to a spousal benefit of 50% of your spouse’s full retirement age Social Security benefit. Assume your spouse’s Social Security full retirement age benefit is $2,500, so therefore you would be entitled to $1,250. Since 2/3rds of your public sector government pension is $2,000 ($3,000 x 66%) and is greater than the spousal benefit of $1,250, the spousal benefit is reduced to zero.


Now let’s assume your public sector government pension is $1,500, then you would be entitled to a $250 spousal benefit. Here’s the math: $1,500 x 66% = $1,000. The Social Security spousal benefit reduced by the GPO of $1,000 produces a spousal benefit of $250. From this last example you can see that the full 50% spousal benefit of $1,250 is made up of $1,000 from your public sector government pension and $250 from Social Security.

As you can see from the above example, the GPO can reduce your Social Security spousal benefit to zero.