If you’re entitled to a Government or Non-profit pension and Social a Security benefit, you might not receive as much as you expected – why?
The Government Pension Offset can reduce or even eliminate your benefit…it’s the Government’s way of placing limitations on people double dipping in multiple US retirement systems.
To figure if you’ll receive a benefit, simply multiply your monthly pension amount by 2/3rds, or 66.66%, and subtract that number from your social security benefit – if the number is negative, you will not receive a benefit, a positive number is the amount you’ll receive from the administration.
As an example, let’s assume you had a monthly pension amount of $5,000 and a social security benefit of $2,000. We start by multiplying $5,000 by 66.66%, which is $3,333, and subtract that from $2,000. The answer is negative, so this individual will NOT receive a Social Security benefit.
However, if the pension amount was $1,500 per month, the social security benefit would be roughly $1,000 per month.