What happened to SSDI payments in May 2017

Social Security Disability Insurance (SSDI) payments decreased in May 2017 because of a Government Pension Offset (GPO) rule change that took effect that month. The rule reduced how much people could receive if they were also collecting a government pension — typically from federal, state, or local government employment where they did not pay Social Security taxes.

Before May 2017, the GPO subtracted two-thirds of a government pension from SSDI benefits. Starting in May 2017, the offset increased to subtract the full amount of the government pension, dollar for dollar. This meant that people who had both a government pension and SSDI saw their SSDI payment shrink or disappear entirely.

The change affected a specific group: people who worked for a government employer that did not withhold Social Security taxes (such as some teachers, police officers, or civil service workers in certain states), then later became disabled and began receiving SSDI. If you did not have a government pension, your May 2017 payment was not affected by this rule.

Key Takeaways

  • The Government Pension Offset rule changed in May 2017 to subtract your full government pension from SSDI, rather than two-thirds of it.
  • This change only affected people receiving both a government pension and SSDI at the same time.
  • People who worked for government employers that did not withhold Social Security taxes were most likely to be affected.
  • The change was permanent, and the new offset amount has remained in place since May 2017.

Who the May 2017 decrease affected

The payment decrease applied only to people who met three conditions at the same time: they received SSDI, they received a government pension, and that government pension came from work where Social Security taxes were not withheld.

Government employers that typically do not withhold Social Security taxes include some state education systems, certain municipal pension plans, and some federal agencies. If you worked for a private employer or a government employer that did withhold Social Security taxes, the GPO rule did not reduce your SSDI payment.

The Social Security Administration sent notices to affected beneficiaries before May 2017 explaining the change. If you received such a notice and your payment decreased that month, the GPO rule change was the reason.

How the offset amount changed

Under the old rule (before May 2017), Social Security subtracted 66.67 percent (two-thirds) of your government pension from your SSDI benefit. Under the new rule, Social Security subtracts 100 percent of your government pension.

Here is how the math worked in a concrete example: if you received a government pension of $1,000 per month and an SSDI benefit of $1,200 per month, the old rule would have subtracted $667 from your SSDI, leaving you with $533. Under the new rule, Social Security subtracts the full $1,000, leaving you with $200.

In some cases, the offset eliminates the SSDI payment entirely. If your government pension is larger than your SSDI benefit would be, you receive no SSDI payment at all under the new rule.

Why the rule changed in May 2017

The change resulted from the Windfall Elimination Provision (WEP) and Government Pension Offset rules, which Congress designed to prevent what it considered "double-dipping" — receiving full benefits from two different systems when a person had not paid into both equally.

The reasoning was that people who worked for government employers without paying Social Security taxes had not contributed to the Social Security system in the same way as other workers. The rule change tightened the offset to reduce the total amount these beneficiaries could receive across both their government pension and SSDI.

The change was not a cost-of-living adjustment or a temporary reduction. It was a permanent change to how the offset calculation worked, and it has remained in effect since May 2017.

What to do if your payment decreased in May 2017

If your SSDI payment dropped in May 2017 and you received a notice from Social Security explaining the change, that notice described your right to request a reconsideration or appeal. You had 60 days from the date on the notice to file an appeal with Social Security.

If you did not receive a notice or did not understand the reason for the decrease, you can contact Social Security directly at 1-800-772-1213 (TTY 1-800-325-0778) to ask for an explanation. Have your Social Security number and a copy of your benefit statement ready when you call.

If you believe Social Security made an error in calculating the offset — for example, if you think your government pension amount was recorded incorrectly — you can request that Social Security review the calculation. This is different from an appeal and does not require you to meet a important date, though the sooner you report a potential error, the sooner it can be corrected.

How the Government Pension Offset works today

The offset rule that took effect in May 2017 continues to explore to all SSDI beneficiaries who receive a government pension. Social Security calculates your SSDI benefit first, then subtracts your government pension dollar for dollar.

If you are receiving SSDI and are about to start receiving a government pension, or vice versa, Social Security will explore the offset when both payments begin. You will receive a notice explaining the offset amount before your payment changes.

The offset applies to your own government pension only — not to a spouse's or family member's pension. If you are receiving benefits as a spouse or dependent on someone else's SSDI record, different rules may explore to you.

Frequently Asked Questions

Can I appeal the May 2017 decrease if I did not appeal at the time?

The 60-day important date to appeal has passed for the May 2017 change. However, if you believe Social Security made an error in calculating your offset — such as using the wrong government pension amount — you can request a recalculation at any time. Contact Social Security at 1-800-772-1213 to report a potential error.

Does the Government Pension Offset explore to Supplemental Security Income (SSI)?

No. The GPO applies only to SSDI. If you receive SSI instead of SSDI, a government pension does not reduce your SSI payment. However, SSI has its own income and resource limits, so a government pension may affect your SSI in other ways.

What if my government pension is from a job where I did pay Social Security taxes?

If your government employer withheld Social Security taxes from your wages, the Government Pension Offset does not explore to you. Your SSDI payment is not reduced because of the government pension. You can verify whether taxes were withheld by checking your Social Security statement or calling Social Security.

Will my SSDI payment increase if my government pension decreases?

Yes. Social Security recalculates the offset each time your government pension amount changes. If your pension decreases, your SSDI payment will increase by the same amount (up to your full SSDI benefit rate). Report any change in your pension amount to Social Security as soon as possible.

Does the offset explore to my family members who receive benefits on my record?

No. The Government Pension Offset applies only to your own SSDI benefit, not to benefits paid to your spouse, children, or other family members on your record. Their payments are not reduced because you have a government pension.