Social Security Administration Disburses Retroactive Payments

Hannah Bietz
Retroactive Payments
Retroactive Payments

The Social Security Administration (SSA) has announced that over one million people have received retroactive payments due to the Social Security Fairness Act. Former President Joe Biden signed this law in January, which helped increase Social Security benefits for nearly 3 million public workers whose payments were affected by the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO). These provisions had previously eliminated or reduced benefits for those who received a pension for work that was not covered by Social Security due to not paying Social Security taxes.

The new law provides an opportunity for these public workers to receive an increase in their monthly Social Security benefits, applicable to benefits payable after December 2023. The average retroactive payment distributed to a recipient to date is approximately $6,710. The Congressional Budget Office (CBO) estimated that eliminating the WEP will increase monthly Social Security benefits by around $360 on average for 2.1 million people by December 2025.

Social Security retroactive payments distributed

With the elimination of the GPO, CBO estimated that monthly benefits will increase on average by $700 for 380,000 spouses and by $1,190 for 390,000 surviving spouses. Many beneficiaries are expected to receive their one-time retroactive payment by the end of March.

This payment will be deposited directly into the bank account on record with Social Security. The SSA recommends refraining from asking about the status of retroactive payments until April, as they will continue to be processed incrementally throughout March. For individuals expecting an increase in monthly Social Security benefits, the new monthly payout amount will begin with the April payment.

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To be eligible for retroactive payments, beneficiaries must have paid Social Security taxes. Notifications of adjustments or payments, along with the dates on which beneficiaries will receive them, will be sent by conventional mail to the recipients’ Social Security registered bank accounts.

Photo by; Van Tay Media on Unsplash

Hannah is a news contributor to SelfEmployed. She writes on current events, trending topics, and tips for our entrepreneurial audience.