There is very good news for U.S. citizens. That’s because President Joe Biden has signed the Social Security Fairness Act into law. Thanks to this, almost 3 million people will receive retroactive Social Security benefits starting January 2025 totaling more than 4,000 euros. This is quite useful income, more so considering the complicated economic context facing the United States today.
Why will this amount be delivered?
The enactment of this law means that retroactive payments will be made to millions of citizens who were previously ineligible to receive full Social Security benefits because of their work. This new regulation primarily benefits all those who perform public service functions, e.g., teachers, firefighters, police officers and government employees.
The push to increase payments to Social Security beneficiaries has been years in the making. Today, the retroactive payment to be given to Americans will be $4,000. This was confirmed by lawmakers after lengthy sessions in Congress.
What is the Social Security Fairness Act about?
The Social Security Fairness Act eliminates the Windfall Elimination Provision (WEP). It also takes out of service the Government Pension Offset (GPO), which was passed by both houses in Congress with bipartisan support during 2024.
Despite this, some Republicans opposed this bill at the last minute. Their explanation for this position is that the legislation would come at a great cost to the national government. According to the Office of Social Security Equity, it would add about $195 billion to the federal deficit over a decade.
The WEP was a law that worked against American workers. It reduced Social Security benefits for those receiving public sector employee pensions. Also included on these rolls were state and federal workers, who are or are not required to make Social Security payroll tax contributions. In this case, it does not matter if they contributed through other employment throughout their career or if they are eligible to receive benefits.
The GPO reduced benefits for spouses or survivors of retired local, state, and federal government workers who did not pay Social Security payroll taxes. This regulation affected nearly 800,000 retirees nationwide.
Important details about this new rule and the retroactive payments that Social Security will award in 2025
In addition to improving future benefits, the details of the Social Security Fairness Act stipulate that the Social Security Administration must make back payments. This check delivery should begin in mid-January and could extend for a few more months.
The CBO has projected that eliminating the WEP would result in an average increase of $360 per month. This amount has already been confirmed by Joe Biden in his recent remarks. By signing this bill, we are extending Social Security benefits to millions of people. This will benefit teachers, sick and other public employees, and their spouses or survivors,” the President said at a press conference.
This means that, on average, citizens would receive $4,320 in retroactive payments from January through December 2024. In that regard, the CBO also estimated that eliminating the GPO would increase monthly benefits by an average of $700 by December 2025 for those whose benefits are based on living spouses. For those receiving benefits as a widow, widower, or surviving spouse, the increase would be $1,190.
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