In a major step toward benefit fairness, the U.S. government has scrapped two rules that had long reduced Social Security payments for many public workers like teachers and first responders. The repeal of the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) is already increasing monthly payments for retirees and even includes retroactive payouts. For those who split their careers between jobs that did and didn’t pay into Social Security, this is a long-awaited win.
Beginning in early 2025, these changes are now fully in motion. Beneficiaries affected by WEP are not only seeing more in their monthly checks but are also receiving retroactive payments that stretch back to the start of 2024. These extra funds are bringing meaningful financial relief to many retirees, potentially adding hundreds of dollars to their monthly income.
Repeal of WEP and GPO: What It Means for Retirees
On January 5, 2025, President Joe Biden signed into law the Social Security Equity Act, permanently eliminating both the WEP and GPO. These provisions had long reduced the Social Security benefits for public employees who also received pensions from jobs not covered by Social Security. With their removal, those retirees will now receive the full amount of their earned benefits without unfair deductions. The Social Security Administration started rolling out these changes in February, and adjusted monthly payments began showing up by April 2025.
This overhaul is especially beneficial for workers who delayed claiming their Social Security in hopes of softening the impact of WEP. With the repeal, it may now be more attractive for some retirees to begin receiving benefits earlier than planned. Of course, choosing when to claim still depends on personal circumstances, including how long one expects to rely on Social Security as a main income source.
Retroactive Payments and Monthly Benefit Changes
The SSA’s rollout included back payments for benefits dating to January 2024. These retroactive amounts can be significant, especially for those who have been retired during the transition period. On top of that, the monthly payments moving forward are larger—sometimes by several hundred dollars—providing retirees with more financial breathing room.
While retirees have the option to begin collecting benefits at age 62, doing so comes with a trade-off: lower monthly checks. The full retirement age for most people sits between 66 and 67, but waiting until 70 brings the highest payout thanks to delayed retirement credits. In 2025, the max benefit at age 62 is $2,831, while someone waiting until age 70 can receive up to $5,108 monthly—an over 80% increase.
How Earnings Impact Your Social Security Check
Social Security benefits are tied directly to your work history—specifically, your 35 highest-earning years, adjusted for inflation. That amount is used to calculate your Average Indexed Monthly Earnings (AIME), which feeds into your Primary Insurance Amount (PIA). The wage cap for Social Security taxes rose from $168,600 in 2024 to $176,100 in 2025. If you’ve consistently earned at or above this level for three-and-a-half decades, you’re on track to collect a sizable benefit in retirement.
New Tax Rules Offer a Bit of Relief
Even with bigger checks, some retirees could still face taxes on their Social Security income. That’s because the income thresholds for taxing benefits haven’t changed since 1993. However, a recent law signed by former President Donald Trump on July 4 introduces a new tax deduction of $6,000 for individuals over 65. This deduction, effective from fiscal year 2025 through 2028, may help reduce taxable income for some seniors, though it doesn’t wipe out taxes for everyone.
This tax break won’t apply to retirees under age 65, those with very low income who already pay no taxes, or individuals earning over $75,000 ($150,000 for joint filers). Still, it provides a meaningful reduction for many in the middle-income range, allowing them to hold on to a bit more of their hard-earned benefits.
