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Government Pension Offset

Released: May 2024

BACKGROUND: The Government Pension Offset (GPO) adjusts Social Security spousal or widow(er) benefits for people who receive “non-covered pensions.” A non-covered pension is a pension paid by an employer that does not withhold Social Security taxes from your salary, typically, state and local governments or non-U.S. employers.

Congress created the GPO in 1977 to help ensure that spousal and widow(er) benefits of those with covered or non-covered lifetime earnings would be roughly equal. a Under Social Security's dual-entitlement rule, spouses with their own covered earnings have their spousal benefits offset dollar-for-dollar by their own earned benefit. The GPO has a similar intention; the offset originally was dollar-for-dollar for non-covered pensions, but Congress reduced it to two-thirds in 1983.

HOW THE GPO WORKS: The GPO reduces the spousal or widow(er) benefit by two-thirds of the monthly non-covered pension and can partially, or fully, offset an individual's spousal/widow(er) benefit, depending on the amount of the non-covered pension. The chart below shows how the GPO would affect spousal benefits for two non-covered pension amounts.

Illustration. Title: G P O Examples for Different Non-Covered Pensions: For a hypothetical spouse of a covered worker with an $1,800 benefit. Three mini bar charts left to right. First, a single bar showing the baseline: Spousal benefit before G P O equals $900. Then another divided bar showing partial offset bar: If the spouse has a $1,000 non-covered pension, the G P O would equal $667. This GPO is smaller than the spousal benefit so the remaining benefit of $233 would be paid. Then, final bar showing full offset: If the spouse has a $1,600 non-covered pension, the G P O would equal $1,067. This GPO is larger than the spousal benefit so no benefit is paid.

CHARACTERISTICS OF GPO BENEFICIARIES:b In 2022, the GPO applied to approximately 12.6 percent of the 5.84 million spousal or widow(er) beneficiaries c (734,601 beneficiaries). Beneficiaries affected by the GPO had an average monthly non-covered pension of $2,690, which was nearly $865 more than the average Social Security retired worker benefit of $1,825 in 2022. Nearly 70 percent of beneficiaries affected by the GPO had their entire spousal or widow(er) benefit offset and had an average monthly non-covered pension of $3,502. Those with partially offset benefits had an average non-covered pension of $999.

Chart set. Title: Selected Characteristics of G P O Population, 2022. Footnote b. Four pairs of data. 83% were women and 17% were men. 52% received a spousal benefit and 48% received a widow(er) benefit. 70% had a full offset and 30% had a partial offset. The average benefit before offset was $1,058 and after offset was $249.

a. Social Security Administration, Annual Statistical Supplement, 2023, p. 16.

b. GPO beneficiary tabulations are based on unpublished data from the Social Security Administration, Office of Research, Evaluation, and Statistics.

c. Includes spouses of retired and disabled workers and disabled and non-disabled widow(er)s. See Social Security Administration, Annual Statistical Supplement, 2023, Table 5.A1.