Government Pension Offset (GPO)
The Government Pension Offset (GPO) was a provision that reduced Social Security spousal or survivor benefits by two-thirds of the amount of a government pension from non-covered employment. The GPO was REPEALED by the Social Security Fairness Act, signed into law on January 5, 2025, with retroactive benefits back to January 2024.
Exam Tip
GPO was REPEALED January 2025 by Social Security Fairness Act! Historically reduced spousal/survivor benefits by 2/3 of non-covered pension. Could completely eliminate benefits. Repealed along with WEP.
What is the Government Pension Offset?
The Government Pension Offset (GPO), enacted in 1977, reduced Social Security spousal or widow(er) benefits for individuals who also received a pension from federal, state, or local government employment where Social Security taxes were not withheld.
CRITICAL UPDATE: The GPO was REPEALED by the Social Security Fairness Act, signed by President Biden on January 5, 2025. Benefits are retroactive to January 2024.
GPO Repeal Details
| Milestone | Date/Status |
|---|---|
| Law Signed | January 5, 2025 |
| Effective Date | Retroactive to January 2024 |
| Payment Distribution | Started February 25, 2025 |
| Completion | July 2025 (ahead of schedule) |
How GPO Worked (No Longer Applies)
| Component | Calculation |
|---|---|
| Reduction Amount | 2/3 of non-covered pension |
| Applied To | Spousal and survivor benefits only |
| Result | Could partially or fully eliminate benefit |
GPO Example (Historical)
| Scenario | Amount |
|---|---|
| Non-Covered Pension | $1,800/month |
| GPO Reduction (2/3) | $1,200/month |
| Spousal Benefit Entitled | $1,000/month |
| Spousal Benefit After GPO | $0 (completely offset) |
Who Was Affected (Historical)
| Group | GPO Applied? |
|---|---|
| State/Local Government Retirees | Often (varies by state) |
| Federal CSRS Retirees | Yes |
| Teachers (some states) | Yes |
| Police/Firefighters (some states) | Yes |
| Federal FERS Retirees | No (covered by SS) |
GPO vs. WEP Comparison
| Feature | GPO | WEP |
|---|---|---|
| Affects | Spousal/Survivor benefits | Own retirement benefit |
| Reduction | 2/3 of pension | Modified bend point |
| Could Eliminate | Entire spousal benefit | Only partial reduction |
| Current Status | REPEALED (2025) | REPEALED (2025) |
Impact of Repeal
| Category | Effect |
|---|---|
| Beneficiaries Affected | ~800,000 (spousal/survivor) |
| Benefit Increase | Varies; some receive full spousal benefit |
| Retroactive Payment | Back to January 2024 |
| Widows/Widowers | Many now eligible for survivor benefits |
CFP Exam Relevance
For CFP Exam Purposes:
- The GPO has been REPEALED as of January 2025
- Historical understanding is still valuable:
- Reduced spousal and survivor benefits
- 2/3 of non-covered pension was the offset
- Could completely eliminate benefits
- Clients previously affected now receive full benefits
What CFP Candidates Should Know
| Topic | Current Status |
|---|---|
| GPO | Repealed (January 2025) |
| WEP | Repealed (January 2025) |
| Law | Social Security Fairness Act |
| Impact | Increased spousal/survivor benefits |
Study This Term In
Related Terms
Windfall Elimination Provision (WEP)
The Windfall Elimination Provision (WEP) was a Social Security formula that reduced benefits for workers who earned pensions from employment not covered by Social Security while also qualifying for Social Security benefits from other covered work. The WEP was REPEALED by the Social Security Fairness Act, signed into law on January 5, 2025, with retroactive benefits back to January 2024.
Primary Insurance Amount (PIA)
The Primary Insurance Amount (PIA) is the monthly Social Security benefit a worker receives if they claim benefits at their Full Retirement Age (FRA). It is calculated using a progressive formula applied to the worker's Average Indexed Monthly Earnings (AIME), with three "bend points" that provide higher replacement rates for lower earners.
Full Retirement Age (FRA)
Full Retirement Age (FRA) is the age at which a person can receive full, unreduced Social Security retirement benefits - age 67 for those born in 1960 or later.