Effect of Foreign Pension on Spousal Benefit

Background Info...
- Eligible for Social Security (SS) based on my work record
- Eligible for Canada Pension Plan (CPP) based on my work record
- Eligible for a Canadian defined benefit (DB) pension based on my work record

My wife:
- Eligible for CPP based on her work record
- Eligible for SS spousal benefit based on my work record

I am planning to set up the CPP pensions and my Canadian DB pension as non-covered pensions in ESPlanner. My understanding is my SS benefit (and accordingly my wife's SS spousal benefit) will be reduced by the WEP. I also understand that the GPO will not apply to my wife's SS spousal benefit when she receives her CPP benefit since CPP is a foreign pension. Can I set up the CPP pensions and my DB pension in ESPlanner to be subject to WEP but not GPO?


Enter previously covered earnings in the Past Covered Earnings panel and any future earnings as appropriate in the Current/Future Covered Earnings panel. Make sure to click on the help icons in the Non-Covered Earnings panel. While the WEP is invoked by foreign pensions (see POMS GN 00307.290: https://secure.ssa.gov/apps10/poms.nsf/lnx/0200307290), the GPO is not (see POMS GN 02608.100: https://secure.ssa.gov/apps10/poms.nsf/lnx/0202608100). The GPO only affects pensions from "federal, state, or local pension based on earnings from non-covered government employment" in the US so be sure to select that it's exempt from the GPO. See our FAQs on the WEP & GPO and on foreign pensions and let us know if you have further questions.

FAQ: Does the software account for foreign income and pensions?

Our software handles income earned by you or your spouse that is considered to be covered by Social Security due to Social Security totalization agreements (http://www.ssa.gov/retire2/international.htm). Here is more information about these international agreements: http://www.ssa.gov/international/totalization_agreements.html.

You only enter income that is covered by Social Security into our software. The software also accounts for pensions that are considered to be non-covered by Social Security.

Please check with Social Security to determine whether any of your or your spouse's income or pensions are considered to be covered or non-covered by Social Security.

FAQ: Does the software account for the Government Pension Offset and the Windfall Elimination Provision?

Yes. We fully account for both the Government Pension Offset (GPO: http://www.ssa.gov/pubs/EN-05-10007.pdf) and the Windfall Elimination Provision (WEP: http://www.ssa.gov/pubs/EN-05-10045.pdf).

You can enter information about pensions based on work not taxed by Social Security on the Non-Covered Pensions panel. Be sure to read and understand the instructions so you can enter the correct information. Also be sure to mouse over all of the Information icons (I) for further instructions.

The effects of the non-covered pension are included in the results. You can explicitly see how the GPO and WEP affect the results by temporarily deleting the non-covered pension and comparing the results with and without the non-covered pension.

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