The Social Security Fairness Act, signed into law by President Joe Biden in January 2025, brings significant changes to Social Security benefits for more than 3.2 million people. The new law eliminates two provisions that were previously reducing benefits for certain workers who had pensions from jobs not covered by Social Security. These workers, including teachers, firefighters, and police officers in certain states, will soon receive retroactive lump-sum payments and higher monthly benefits.
The Social Security Administration (SSA) is speeding up the process of issuing these payments, which means affected individuals will see the money sooner than originally expected. This article explains the changes, the timeline for payments, and what affected beneficiaries need to know about the new benefits.
What Does the Social Security Fairness Act Do?
The Social Security Fairness Act was created to fix a long-standing issue affecting certain individuals who worked in jobs that did not pay into the Social Security system, such as some teachers, first responders, and federal workers. Previously, these workers had their benefits reduced by two rules: the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).
By eliminating these provisions, the new law ensures that more than 3.2 million individuals will now receive full Social Security benefits, with no reductions due to pensions from non-Social Security covered jobs.
Retroactive Lump-Sum Payments and Monthly Benefit Increases
As a result of this change, affected individuals will receive a one-time retroactive lump-sum payment for any benefits they missed since January 2024. Additionally, their monthly Social Security payments will be higher moving forward, depending on the type of benefit they receive and the amount of their pension. For some, this increase could be a few dollars, while for others it could be over $1,000 per month.
The payments are expected to begin arriving by the end of March 2025. Most beneficiaries will see their lump-sum payments and new monthly benefit amounts starting in April 2025.
Speeding Up the Process
Originally, the Social Security Administration estimated that it could take over a year to adjust the benefits and pay all retroactive amounts. However, the SSA has now committed to processing these payments faster, aiming to complete most of the retroactive payments by the end of March 2025.
Social Security acting Commissioner Lee Dudek said that this new expedited timeline is meant to ensure that beneficiaries receive their due benefits as quickly as possible. The agency plans to process the increases to monthly benefits starting in April 2025. Complex cases that cannot be processed automatically may take longer.
Who Is Affected by the Social Security Fairness Act?
The changes brought by the Social Security Fairness Act will benefit people from various backgrounds. Among the affected groups are:
- Teachers, firefighters, and police officers in certain states
- Federal employees covered by the Civil Service Retirement System (CSRS)
- Individuals who worked under foreign social security systems
These individuals had been negatively impacted by the WEP and GPO rules in the past. With the new law, they will now receive the full Social Security benefits they deserve.
What Affected Beneficiaries Should Know
For most people, retroactive payments will be directly deposited into their bank accounts by the end of March 2025. In addition to the lump-sum payment, all beneficiaries will receive a notice by mail from the SSA. This notice will detail the retroactive payment and the new monthly benefit amount, and it should arrive within 2 to 3 weeks of the retroactive payments.
If your direct deposit information or mailing address is up to date with the Social Security Administration, no further action is required. However, if you want to verify or update your information, you can log into your personal online account or contact the SSA.
Beneficiaries are advised to wait until after they have received their April 2025 monthly check before contacting the SSA to inquire about their new benefits. The SSA also asks beneficiaries to hold off on asking about their retroactive payments until April.
Final Thoughts
The Social Security Fairness Act brings much-needed relief to millions of workers who were unfairly penalized because of their pensions from non-Social Security covered jobs. Thanks to this new law, they will receive the full benefits they are entitled to, along with retroactive payments and higher monthly checks. The accelerated processing timeline ensures that most people will get their money quickly, helping to improve their financial situation. If you are affected by these changes, keep an eye on your bank account for lump-sum payments and updated monthly benefits.