Giantaxe

Correct.

Glasgow Girl

Yes, provided your annual income meets or exceeds the maximum Social Security Limit, doesn’t matter how you get there. The way they calculate it gives more credence to lower earnings, so someone averaging $50K over 35 years, will get quite a bit more than half of someone earning $100K over the same 35 years. Go to the social security website, and they will give you a pretty accurate estimate of what you will get under todays rules.

https://www.ssa.gov/benefits/retirem...xoC2YAQAvD_BwE

reltub

Just so I am clear, are company pension schemes (Defined Benefit / Final Salary) and Private Pensions considered for WEP, or just the UK State pension. i,e. if I defer my UK state pension until I am 70, but receive income from other pensions in the meantime, will my SS be WEP'd based on that income? Thanks

Glasgow Girl

Yes, Defined Benefit/FinalSalary company pensions are subject to WEP. Only pensions received from voluntary contributions are free from WEP. Those are normally pensions from Free Standing Additional Contributions, FSAVCs, personal pensions totally independent from any employer contributions, or any part of the UK state pension that is based on voluntary NIC’s. Standard defined benefit

shabir1

I am confused...I had ten years paid into my pension account. After which I was allowed to pay 17 years of "Class3" nics. Which I have done.
Question is that since my payments were voluntary Class3, How and if will those voluntary payments affect my "WEP" penality on my US social security.
I read on one of the posts in this thread that voluntary nics payments are excluded from the calculation for the penalty.
Is this correct?
Thanks,
Shabir.

lansbury

The voluntary payments are not counted towards WEP, or to be precise the part of the pension you derive from those payments. The UK pensions office should be able to tell you how much of your UK State pension comes from the voluntary payment, make sure you tell SS that figure.

shabir1

Wow...too awesome as I have paid in 17 years at Class3 rate. I thought I was going to lose about $340 a month as I only have "21" years of substantial income. This brings it down to only $125 a month WEP hit. Made my day! Thanks agin.

durham_lad

Exactly.
​​​​​​
When you claim SS you add to your UK pensions record a copy of SSA-308 detailing the years of voluntary contributions.

https://www.ssa.gov/forms/ssa-308.pdf

S Folinsky

I can give my experience. My wife worked for 28 years for LA county which did not contribute to Social Security. She also had 14 years of SS earnings. Knowing her county pension would be subject to WEP, she started drawing her her SS at full retirement age (then 65). Inasmuch as she was still working, WEP did not yet apply. I am younger than my wife. When I reached full retirement age (then 66) I was able to use a procedure which is no longer available. I deferred MY social security while at the same time claiming spousal benefit of 50% based on her benefit. Bye and bye, my wife retired and stated drawing her County pension. This when WEP cranked in to reduce her SS payment. Ancillary to that, my spousal benefit was also reduced since it remained at 50% of her benefit. In the meanwhile, my deferred monthly benefit continued to increase. When I reached age 70, I gave up my spousal benefit and started drawing my full benefit. That benefit is not subject to WEP. (It should again be noted that the combination of benefits I used is no longer allowed).

BTW, there has been a bipartisan movement afoot to eliminate WEP (inasmuch as it is retired schoolteachers who are most impacted by WEP). But it never seems to go anywhere. But it has enough weight behind it that it just pop up one day. One never knows.

Steerpike

Keep in mind also, according to this page - https://www.ssa.gov/international/ - your UK pension won't trigger WEP regardless of voluntary contributions or not, if you have enough SS contributions. From that site:

The Windfall Elimination Provision doesn’t apply if:
- (list o' stuff that's not relevant to me...)
- You have 30 or more years of substantial earnings under Social Security.

durham_lad

Correct.

also correct, OAP does not affect until WEP until you start taking SS. This was exactly the case with my wife this year.