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UK state pension and USA social security

UK state pension and USA social security

Old May 4th 2016, 11:44 pm
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Default Re: UK state pension and USA social security

Originally Posted by Lechtenberg View Post
Just an update to my previous posts regarding the WEP provision where the US gov. takes a chunk out of your Soc. security because you get a British pension. Next year when my husband gets his S.S. Pension I know I can claim half of his as its so much more than mine. However, I've been knformed by the S.S. Office that they will still deduct $200 from the amount I get to allow for the "windfall" I received for twelves years of work in England.
My husband will get his full amount as he has worked for the requisite amount of quarters and had paid SS tax on all of them.
As an example. If you currently receive $500 less $200 WEP for a total of $300, when your husband retires if he receives $2000 your pension is calculated like this.

Your own $500 less $200 WEP plus $700 based on your husbands pension to give you 50% of his. The final amount you receive will be 50% of your spouses pension. If they tell you otherwise dispute it. The final amount of a spouse pension is not subject to WEP. My spouse pension is not subject to WEP I receive the full amount.
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Old May 4th 2016, 11:57 pm
  #1187  
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Default Re: UK state pension and USA social security

Originally Posted by lansbury View Post
As an example. If you currently receive $500 less $200 WEP for a total of $300, when your husband retires if he receives $2000 your pension is calculated like this.

Your own $500 less $200 WEP plus $700 based on your husbands pension to give you 50% of his. The final amount you receive will be 50% of your spouses pension. If they tell you otherwise dispute it. The final amount of a spouse pension is not subject to WEP. My spouse pension is not subject to WEP I receive the full amount.
I'm sorry I not sure if I'm understanding you correctly. Are you saying. If my husband gets $2000 half of that would be $1000. If I got $500 and they took $200 leaving me $300, then they'd give me the extra $700 to make it up to $1000 which is half my husbands SS. So I should watch out that they don't try to to give me half of my husbands amount i.e $1000 and then deduct $200 leaving me with only $800.
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Old May 5th 2016, 12:53 am
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Default Re: UK state pension and USA social security

Originally Posted by Lechtenberg View Post
I'm sorry I not sure if I'm understanding you correctly. Are you saying. If my husband gets $2000 half of that would be $1000. If I got $500 and they took $200 leaving me $300, then they'd give me the extra $700 to make it up to $1000 which is half my husbands SS. So I should watch out that they don't try to to give me half of my husbands amount i.e $1000 and then deduct $200 leaving me with only $800.
Yes that is what I was saying.
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Old May 5th 2016, 4:43 am
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Default Re: UK state pension and USA social security

Originally Posted by lansbury View Post
Yes that is what I was saying.
Thanks for the info. I'll watch out next year. I don't trust that they know what they are doing.
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Old May 5th 2016, 5:17 pm
  #1190  
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Default Re: UK state pension and USA social security

Originally Posted by Lechtenberg View Post
Because they are detailed doesn't make them fair. I feel I'm caught up in a system designed to deal with others problems. Being aware of something doesn't make it right. Having worked to earn my money, paid all my taxes and paid into both countries pension systems. It definitely feels as if my contributions are being stolen. I realize a lot of ex pats don't report their pensions. I did and look where honesty got me.
When you apply for SS they ask where were you were born? That's a red flag right there. If you didn't start work in the US until you were 40, and you said you were born in the UK, then some serious questions are going to be asked!
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Old May 11th 2016, 8:11 pm
  #1191  
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Default Re: UK state pension and USA social security

Originally Posted by Disenchanted View Post
A quick update, a work associate recently had a meeting with SSA and I asked him if he could ask if the above was true. He called me a couple of days ago and said that the SSA agent confirmed that he will not have WEP applied to his SS pension as long as he's not drawing his Civil Service pension. He turns 66 soon and will be drawing his SS pension.
Hi guys! Been away for sometime. Still debating WEP! Not surprised.
Question: I think what the agent told him, makes sense. But how about a situation where one starts drawing Pension ( after the SS Pension started), would one be subject to WEP in regards to their deferred pension (for the past few years, pension was not claimed). I am talking this in the context of UK State pension now. And if one opts for a one time lump sum relating to the deferred years pension, would that lump sum be subject to WEP?

I know, as nun points out, Lump sum taken in lieu of periodic future pension payments, is subject to WEP (using the annuity formula). My thoughts are, lump sum taken for deferred pension is not subject to WEP. However, it is taxable. Any thoughts?
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Old May 11th 2016, 8:19 pm
  #1192  
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Default Re: UK state pension and USA social security

I'm curious to know if the number of quarters required was lower at some point in time. Are they likely to raise the required number of quarters in the next 20 years?
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Old May 11th 2016, 8:25 pm
  #1193  
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Default Re: UK state pension and USA social security

UK National insurance is based on "Contribution Years". US system is based on "Quarters"
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Old May 11th 2016, 8:26 pm
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Default Re: UK state pension and USA social security

Originally Posted by rogerpenycate View Post
Cat SailorIf it helps, to get any sort of pension in the US it's necessary to work for 10 years, I'd done 13 years.Because I qualified for a full UK pension my US pension was basically cut in half PLUS the US taxed my UK pension which I'd deferred for a year. (They took about $1,500 out of my lump sum from the UK) and it's an ongoing thing, so my UK pension will be $900-$950 (subject to the exchange rate) less tax. Hope this helps.Some people have said they don't even declare their UK pension but that's a dangerous game.As you will know there's a lot of inter-agency information passed around and as I had already declared my UK pensionwhen I applied for my US Social Security, it may have raised a red flag if I hadn't declared it on my 2015 tax return.I also understand the penalties can be extremely HARSH if caught.
rogerpenycate, at least there is one individual here who deferred UK pension and opted for a lump sum relating to the deferral! Sure, it is taxable as it is treated as other income for tax purposes. You did not say how the SS treated it for WEP purposes, if at all. My guess is, lump sum relating to the deferred pension is not WEPed. But may be you can throw some light upon it.
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Old May 12th 2016, 3:17 am
  #1195  
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Default Re: UK state pension and USA social security

Originally Posted by scot47 View Post
UK National insurance is based on "Contribution Years". US system is based on "Quarters"
US system is based on contribution years - 35 years. You need 40 quarters to be eligible for SS.
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Old Jun 21st 2016, 11:42 pm
  #1196  
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Default Re: UK state pension and USA social security

Hi,first post to this forum.
I have read approx the first 20 or so posts regarding U.S SS payments to British citizens outside of the UK etc.
I worked and paid into the U.S SS system as a G/C holder from 1980 -2005,my G/C has now expired and my last presence in the U.S was 2007.

I am now coming up to my 65th Birthday,I have received my letter from the UK DWP requesting me to make my application to receive my UK state pension in Aug 2016.

I held off making application for my U.S SS payments but I intend to make application soon as I qualified for the reduced amount 3 years ago.

What would be the best way to initiate my first contact with the SSA and is there going to be a reduction in either one (or both) of the pensions because I will be receiving 2 pensions at the same time?
Thank you.
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Old Jun 21st 2016, 11:50 pm
  #1197  
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Default Re: UK state pension and USA social security

Originally Posted by monkeybrains View Post
Hi,first post to this forum.
I have read approx the first 20 or so posts regarding U.S SS payments to British citizens outside of the UK etc.
I worked and paid into the U.S SS system as a G/C holder from 1980 -2005,my G/C has now expired and my last presence in the U.S was 2007.

I am now coming up to my 65th Birthday,I have received my letter from the UK DWP requesting me to make my application to receive my UK state pension in Aug 2016.

I held off making application for my U.S SS payments but I intend to make application soon as I qualified for the reduced amount 3 years ago.

What would be the best way to initiate my first contact with the SSA and is there going to be a reduction in either one (or both) of the pensions because I will be receiving 2 pensions at the same time?
Thank you.
It looks like you have contributed to US SS for 25 years, so you will likely have your SS payments reduced slightly under the Windfall Elimination Provision.

Be aware that you have the option to defer one or the other (UK SP or US SS) or both, and will receive an increased payment when you do finally claim.
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Old Jun 22nd 2016, 12:21 am
  #1198  
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Default Re: UK state pension and USA social security

I think if you wait until you're 70 you may be able to meet the WEP requirements, unfortunately I think you would have to be working for those 5 years. You may be able to work part time and still qualify.
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Old Jun 22nd 2016, 12:24 am
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Default Re: UK state pension and USA social security

Would prefer to go for it now....5 years is too far off.
Thank you.
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Old Jun 22nd 2016, 12:27 am
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Default Re: UK state pension and USA social security

Originally Posted by Pulaski View Post
It looks like you have contributed to US SS for 25 years, so you will likely have your SS payments reduced slightly under the Windfall Elimination Provision.

Be aware that you have the option to defer one or the other (UK SP or US SS) or both, and will receive an increased payment when you do finally claim.
ok,that could work....I want to go ahead with the U.S SS as I think I may have some complications with them.
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