Personal Finance

President Biden Just Signed New Social Security Bills. Whose Benefits are Getting Bigger?

Christy Bieber

Published: January 14, 2025 8:49 am

In one of his last acts before leaving office, President Biden signed The Social Security Fairness Act, H.R. 82. This law reflects the first major reforms to Social Security that have taken place in decades. The law will entitle some retirees to get significantly more money than they were receiving before.

Here’s what the new legislation does, along with some details on who will benefit from it.

What is the Social Security Fairness Act?

The Social Security Fairness Act repealed two existing Social Security laws that have restricted benefits for certain workers for decades. The laws that were repealed include:

• The Windfall Elimination Provision (WEP)
• The Government Pension Offset (GPO)

The WPO changed the formula used to calculate Social Security benefits for certain workers who both collect Social Security and receive non-covered pensions.

The standard Social Security formula replaces a certain percentage of average wages over your working years,  but it’s a progressive formula so the percentage of wages replaced is higher for low earners. Workers who earned income from jobs that provided a non-covered pension but didn’t pay into Social Security would potentially end up getting a “windfall” if they also collected Social Security because they’d be treated like long-time low-wage earners. The WPO altered the formula to replace a lower percentage of their average wages with Social Security so this doesn’t happen.

The Government Pension Offset also offsets Social Security benefits for people who receive both Social Security and a government pension that comes from working a job that didn’t require them to pay into the retirement benefits program.

The Social Security Fairness Act repealed both of these laws, making it possible for those who receive pensions from public service or government work to now also get their full Social Security benefits if they also worked jobs that made them eligible for those payments.

Who is getting more money due to the Social Security Fairness Act?

According to the American Federation of Government Employees, more than two million retired public employees, sponsors, and survivors who lost Social Security benefits due to the WEP and GPO will now receive more Social Security income. Specifically, affected retirees will see their Social Security benefits increase by an average of $360 monthly.

In addition to getting larger benefit checks in the future, affected workers will also receive a lump sum payment to cover the amount of money they should have been paid in the past. This will include thousands of dollars in income from last year.

The Social Security Administration will be processing the extra payments automatically for those who have already filed for Social Security and had their benefits partially or completely offset. For those who didn’t file for Social Security benefits before but who are receiving a public pension, it will be important to file online or by scheduling an appointment with the local Social Security office to make sure the benefits owed can be paid out properly.

These law changes will affect not just public workers, but all retirees as there is some concern that paying out these additional benefits could result in Social Security’s financial struggles becoming more dire. The trust fund for the benefits program is already expected to run dry in 2035, and paying out extra funds could mean lawmakers must act sooner rather than later to shore up Social Security’s finances and preserve full benefits for all retirees.