SSA reduced my SS retirement benefit for a government pension that I don't get. I'm confused. WEP!

[FrankFanboy]

Hi all,

From 1983 to 1991, I worked under the federal CSRS system and paid into that federally-funded retirement system. However, I separated from federal employment in 1991 and starting working for a FICA/SS contributing employer that I now get a small pension from (I'm fully retired). 

When I left the federal agency that I worked for in DC, I was severed from CSRS and was given the option to take a cash lump sum payout, which I did.

Now at 62, I have applied for early retirement with the SSA. They penalized my SSA estimated retirement benefit with a huge reduction, hitting it with a Windfall Elimination Provision (WEP). They said that my years of non-covered SS work looks suspicious such that I might be receiving a government pension that I failed to report. Since I cashed out of CSRS with a lump sum in my late 20s, I have no non-covered monthly pension and never will. Yet the SSA hit me with WEP. Does this sound correct?

I have submitted an SSA Form 561, Request for Reconsideration, to ask for a recalculation of my monthly benefits. Has anyone ever heard of sustaining a WEP penalty when there is no monthly government pension?

Thanks, Frank

[GailL1 · Accepted solution]

@FrankFanboy 

IF everything is as you have said in your post:

1.  You severed your public entity employment which was NOT covered by the SS system in 1991

2.  You received a refund of your contributions to the CSRS probably plus interest when you left this public service

3.  You did NOT return to public service that was outside the SS system during the rest of your working years.

4.  You receive NO pension from public service NOT covered by the SS system

If those things are true then then you have done correctly by requested a Reconsideration -

See if you have some sort of proof in your files somewhere -  this form should be in your Federal employment file and I am sure they gave you a copy.  SF 2802 (Application for Refund of Retirement Contributions)

Beginning in January 1984, some government employees began paying into the SS system  - I am wondering if the confusion with SSA might be because of this.  They call this the CSRS OFFSET.  It is their confusion; not yours.  Your refund of contributions should have ended your "vested" status.

FEDSMITH.com - 04/03/2019 - CSRS Offset: An Explanation of the Basics 

But this might be what they are checking out.  So this link is just to let you know why there might be some confusion with the SSA.

Good Luck dealing with them on this - hopefully they will get it right after a short investigation.  IF Not, get help from your Congressman's Office.

Come back and let us know how it all comes out -

[GailL1 · Accepted solution]

@FrankFanboy 

IF everything is as you have said in your post:

1.  You severed your public entity employment which was NOT covered by the SS system in 1991

2.  You received a refund of your contributions to the CSRS probably plus interest when you left this public service

3.  You did NOT return to public service that was outside the SS system during the rest of your working years.

4.  You receive NO pension from public service NOT covered by the SS system

If those things are true then then you have done correctly by requested a Reconsideration -

See if you have some sort of proof in your files somewhere -  this form should be in your Federal employment file and I am sure they gave you a copy.  SF 2802 (Application for Refund of Retirement Contributions)

Beginning in January 1984, some government employees began paying into the SS system  - I am wondering if the confusion with SSA might be because of this.  They call this the CSRS OFFSET.  It is their confusion; not yours.  Your refund of contributions should have ended your "vested" status.

FEDSMITH.com - 04/03/2019 - CSRS Offset: An Explanation of the Basics 

But this might be what they are checking out.  So this link is just to let you know why there might be some confusion with the SSA.

Good Luck dealing with them on this - hopefully they will get it right after a short investigation.  IF Not, get help from your Congressman's Office.

Come back and let us know how it all comes out -

[FrankFanboy · Accepted solution]

Thanks so much ... Yes, I am submitting the reconsideration for a recalculation. However, I have to request a copy of the form you mentioned from OPM for my refund. That was so many years ago that I no longer have those records. Thanks again!