While your Colorado PERA benefit is never reduced when you also receive a Social Security benefit, Social Security has two reductions that may apply to you—the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).
WEP applies to PERA retirees who also receive Social Security earned benefits. It may reduce your Social Security benefit, but the reduction cannot be more than one-half of your monthly PERA benefit. The maximum monthly reduction to your Social Security benefit, which changes each year, is $428 in 2016.
The WEP does NOT apply if:
- You qualified for PERA retirement before 1986.
- You have 30 or more years of “substantial” Social Security earnings.
- You paid Social Security tax on your PERA-covered employment. (This applies to some state and local government retirees covered by both PERA and Social Security.)
GPO applies to PERA retirees who also receive Social Security spousal or widow(er) benefits. It reduces the Social Security benefit by two-thirds of the PERA benefit and may completely eliminate the Social Security benefit.
The GPO does NOT apply if:
- You are not receiving or will not receive a Social Security spousal or widow(er) benefit.
- You qualified for a PERA retirement benefit before June 30, 1983.
- You received a PERA benefit based on work that was also covered by Social Security, depending on the last day of your employment. (This may apply to some state and local government retirees who are covered by both PERA and Social Security.)
Keep in mind that WEP and GPO will apply if your refunded PERA account includes any matching dollars.