A 62-year-old federal worker applying for Social Security now could have that benefit trimmed as much as $140 a month by a law many people have never heard of.

Most federal workers will get some Social Security benefit. But many won't get as much as they think because of the little-known 1983 law.

Congress passed the law to prevent federal workers from getting excessive Social Security benefits for relatively short service in Social Security-covered employment.

The idea was to prevent people who spent most of their working lives paying into the Civil Service Retirement System -- not Social Security -- from taking advantage of Social Security's "welfare tilt." It was designed to help people who had short private careers or low earnings. The so-called tilt gives them a proportionately bigger return in benefits than it does to someone who spent a full career, at high pay, under Social Security-covered employment.

The first inkling the majority of federal workers have of the importance of the windfall act is when they apply for benefits and get less than they expected.

The law reduces, but does not eliminate, the Social Security payment to persons who have less than 30 years of full coverage under Social Security. In other words, unless you worked full time in a Social Security job and paid into the system, your benefit will be reduced if you also qualify for a federal pension.

Until recently, federal civil service jobs were not covered by Social Security. Now, employees in the old Civil Service Retirement System pay the Medicare part of Social Security. Those under the new Federal Employees Retirement System pay the regular Social Security tax. It is 7.65 percent of the first $51,300 of earnings.

The average Social Security benefit for someone retiring this year is $566. The average civil service benefit is about $1,300 monthly, but it can be higher for long-service, high-salaried workers. The maximum Social Security benefit for anyone is $966 a month.

The complex law is detailed in Social Security Fact Sheet No. 2, "A Pension From Work Not Covered By Social Security."

The windfall benefit reduction will not apply to your Social Security benefit if:

You were hired by the government after Dec. 31, 1983, and went into the new Federal Employees Retirement System.

You have 30 or more years of substantial earnings under Social Security.

You retired, or were eligible to retire, from the government before 1986.

If none of those apply to you, chances are you will be affected by the reduced benefits law.

On Aug. 18, Social Security's Fran Valentine will talk about windfall benefits at noon on WNTR radio (1050 AM).


Tomorrow at noon on WNTR, Rita Ziedner of the Federal Times talks about increasing work-at-home opportunities for federal workers.