Government Pension Offsets (GPO) apply to government workers at any level who are not covered by Social Security. Any federal, state or local employee who works for a governmental institution in any capacity and is eligible to receive a separate retirement pension from his or her employer is subject to this offset. The offset will reduce by two-thirds the amount of spousal and/or survivor benefits that the surviving spouse or beneficiary would have been entitled to if he or she were eligible for Social Security.

Rob is a retired educator and receives a pension of $900 per month. His pension was outside the Social Security system. His wife worked for a private corporation throughout her career and had been retired for 10 years before she died. Rob's survivor benefits that he is entitled to from her Social Security will be reduced by $600 per month, two-thirds of the amount of his private pension. Therefore, if he were to otherwise receive $800 of survivor's benefits he would only get $200 per month.
Most of the people that are subject to the GPO will lose all of their survivor's benefits. This can leave many surviving spouses in dire straits financially, and some members of Congress are trying to repeal this provision for this reason.

  1. How are spousal benefits calculated for Social Security?

    The amount of your Social Security spousal benefit depends on a number of factors, including your age, the maximum amount ... Read Full Answer >>
  2. Are catch-up contributions included in the 415 limit?

    Unlike regular employee deferrals, catch-up contributions are not included in the 415 limit. While there is an annual limit ... Read Full Answer >>
  3. Can catch-up contributions be matched?

    Depending on the terms of your plan, catch-up contributions you make to 401(k)s or other qualified retirement savings plans ... Read Full Answer >>
  4. Are catch-up contributions included in actual deferral percentage (ADP) testing?

    Though the Internal Revenue Service (IRS) carefully scrutinizes the contributions of highly compensated employees (HCEs) ... Read Full Answer >>
  5. Do tax brackets include Social Security?

    A portion of your Social Security benefits may be subject to federal taxation using tax brackets. Your tax bracket is determined ... Read Full Answer >>
  6. Can a 401(k) be used for a house down payment?

    A 401(k) retirement plan can be tapped to raise a down payment for a house. You can either borrow money or make a withdrawal ... Read Full Answer >>
Related Articles
  1. Insurance

    What's The Difference Between Medicare And Medicaid?

    One program is for the poor; the other is for the elderly. Learn which is which.
  2. Insurance

    Cashing in Your Life Insurance Policy

    Tough times call for desperate measures, but is raiding your life insurance policy even worth considering?
  3. Retirement

    Pros and Cons of Deferred Compensation Plans

    Learn about the pros and cons of non-qualified deferred compensation (NQDC) plans, including the flexibility of non-ERISA plans and the potential for forfeiture.
  4. Economics

    Understanding Donald Trump's Stance on China

    Find out why China bothers Donald Trump so much, and why the 2016 Republican presidential candidate argues for a return to protectionist trade policies.
  5. Economics

    Will Putin Ever Leave Office?

    Find out when, or if, Russian President Vladimir Putin will ever relinquish control over the Russian government, and whether it matters.
  6. Financial Advisors

    How to Help Plan Sponsors Meet Fiduciary Duties

    Advising 401(k) plan sponsors is a great business model for financial advisors. Here's how advisors can help plan sponsors meet fiduciary obligations.
  7. Retirement

    4 Ways to Boost the Amount You Save for Retirement

    Retirement can easily last more than twenty years, which means you have to save a lot. Thankfully, there are ways to enhance the amount you put away.
  8. Retirement

    How to Fix an Error on Your Social Security Check

    For many seniors, social security benefits checks are their income stream which means the benefit has to be correct. If you spot an error, you can fix it.
  9. Savings

    How To Set Up A Trust Fund If You're Not Rich

    You don't need to be worth millions to create your own trust fund. Learn how your money can be handled in the event of your death.
  10. Retirement

    What Happens to a 401(k) After You Leave Your Job?

    Find out what happens to your 401(k) after you leave your job. Learn about your five primary options, including cashing out and rolling over to a new plan.
  1. Sales Tax

    A consumption tax imposed by the government on the sale of goods ...
  2. Crowding Out Effect

    An economic theory stipulating that rises in public sector spending ...
  3. Gross Domestic Product - GDP

    The monetary value of all the finished goods and services produced ...
  4. Section 1231 Property

    A tax term relating to depreciable business property that has ...
  5. Emergency Banking Act Of 1933

    A bill passed during the administration of former U.S. President ...
  6. Qualified Longevity Annuity Contract

    A Qualified Longevity Annuity Contract (QLAC) is a deferred annuity ...

You May Also Like

Trading Center