The start of 2025 sees the signing of the Social Security Fairness act into law, which is set to expand state benefits for US domestic workers and expats, previously reduced by the Windfall Elimination Provision (WEP).
On the 5th of January 2025, Joe Biden signed the Social Security Fairness Act into law. This bipartisan legislation officially repeals the Windfall Elimination Provision (WEP) which not only increases the state benefits for thousands of domestic workers but also thousands of expats who were receiving old age benefits from other country systems as a result of their time working there.
Previously, should an individual have been eligible to receive a US state pension and also, for example an Italian state pension (due to their contributions to both social security systems) they would have seen their US state pension amount reduced by the Windfall Elimination Provision by between 5 – 50% depending on the number of years of coverage the person had in the US system.
With this latest change in legislation, individuals receiving 2 state pensions will no longer have their US portion reduced and will be eligible to their complete US state pension, calculated by the Social Security Administration on their earnings and contributions to the US system. This could result in substantially higher monthly benefits that an individual would previously not have received.
When enacted into law, the Social Security Fairness Act makes payments retroactive to January 2024.
For a deeper discussion on the above, please reach out to your Vialto Partners point of contact, or
alternatively:
Craig Smith
Senior Manager
Gary Chandler
Director
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