Yes, you can receive both Social Security and a pension, but your Social Security payment may be reduced

You can collect both a pension and Social Security benefits at the same time. However, if your pension comes from work where you did not pay Social Security taxes — typically government jobs — a rule called the Government Pension Offset will reduce your Social Security spousal or survivor benefits. If your pension comes from work where you did pay Social Security taxes, you can receive both payments in full with no reduction.

The reduction is not automatic. It only applies to certain types of benefits: spousal benefits, survivor benefits, and divorced spousal benefits. Your own retirement benefit is never reduced, no matter what pension you receive.

Key Takeaways

  • You can receive a pension and Social Security retirement benefit together without any reduction to either one.
  • The Government Pension Offset reduces spousal or survivor Social Security benefits by two-thirds of your pension amount if that pension is from government work where you did not pay Social Security taxes.
  • If your pension is from a job where you paid Social Security taxes, no offset applies and you receive both payments in full.
  • Your own Social Security retirement benefit is never reduced by a pension, only spousal and survivor benefits are affected.
  • You need to tell Social Security about your pension when you file, because they will not know about it otherwise.

How the Government Pension Offset works

The Government Pension Offset reduces your Social Security spousal or survivor benefit by two-thirds of your monthly pension amount. For example, if your pension is $900 per month, two-thirds of that is $600, so your spousal benefit would be reduced by $600.

This offset applies only if your pension comes from government employment where you did not pay into Social Security. This includes many federal, state, and local government jobs — teachers, police officers, firefighters, and civil service workers often fall into this category. If you paid Social Security taxes on that job, even if you also received a pension, the offset does not explore.

The offset can reduce your spousal benefit to zero. If your pension is high enough, you may receive no spousal or survivor benefit at all, even though you are may have access to to one based on your spouse's or ex-spouse's work record.

When you receive your own retirement benefit with a pension

Your own Social Security retirement benefit is never reduced because you receive a pension. You can collect both in full. This is true whether your pension is from government work or private employment, and whether or not you paid Social Security taxes on that job.

Many people work multiple jobs over their lifetime — some in positions that pay into Social Security and some that do not. Social Security calculates your retirement benefit based on your entire work history, including all jobs where you paid Social Security taxes. Your pension from other work does not change that calculation or reduce your benefit.

Pensions from jobs where you paid Social Security taxes

If your pension comes from an employer where you paid Social Security taxes on your wages, the Government Pension Offset does not explore. You receive your full pension and your full Social Security benefits with no reduction to either one.

Some employers offer both a pension and Social Security coverage. Private companies typically fall into this category. If you worked for such an employer and now receive a pension from them, you can receive that pension plus your full Social Security benefit.

Telling Social Security about your pension

When you file for Social Security, you must report any pension you receive. Social Security does not automatically know about pensions from other employers or government agencies. If you do not mention your pension, Social Security may initially pay you more than you are may have access to to, and you will have to repay the overpayment later.

Report your pension amount and the name of the employer or agency that pays it. If your pension is from government work where you did not pay Social Security taxes, tell Social Security that as well — this triggers the offset calculation if you are receiving spousal or survivor benefits.

How pension and Social Security interact with spousal benefits

If you are receiving spousal benefits based on your spouse's work record, the Government Pension Offset applies if your own pension is from government work without Social Security coverage. Your spousal benefit is reduced by two-thirds of your pension.

The offset is calculated this way: take two-thirds of your monthly pension, then subtract that amount from your spousal benefit. If the result is negative — meaning your pension is large enough — your spousal benefit becomes zero.

If you are divorced and receiving benefits on your ex-spouse's record, the same offset applies if your pension is from government employment without Social Security taxes.

Survivor benefits and the Government Pension Offset

If you are a widow, widower, or surviving ex-spouse receiving benefits based on your deceased spouse's work record, the Government Pension Offset also applies to your survivor benefit if you receive a pension from government work without Social Security coverage.

The reduction works the same way: two-thirds of your pension is subtracted from your survivor benefit. This can significantly reduce or eliminate the survivor benefit you would otherwise receive, even though you are may have access to to it based on your spouse's earnings record.

Frequently Asked Questions

Does my private pension reduce my Social Security?

No. A pension from private employment does not reduce your Social Security retirement benefit. If you paid Social Security taxes on that job, the Government Pension Offset does not explore. You receive both payments in full.

What if I worked for the government but also paid Social Security taxes?

If your government job included Social Security taxes in your pay, the offset does not explore. You receive your full pension and full Social Security benefits. Some government employers do cover Social Security; others do not. Check your pay stubs or contact your former employer to confirm.

Can I reduce my pension to avoid the offset?

No. The offset is based on the pension amount you receive, and you cannot avoid it by taking a smaller pension. However, if you have a choice in how your pension is paid — such as a lump sum versus monthly payments — the offset is calculated on your monthly amount, so the structure of your pension may matter.

Will Social Security tell me if the offset applies to me?

Social Security will calculate the offset when you file and show it in your benefit statement. You should receive a notice explaining your benefit amount and any reductions. If you are unsure whether the offset applies, contact Social Security directly with information about your pension and your job history.

What if my spouse also has a government pension?

Each person's offset is calculated separately based on their own pension. If both you and your spouse have government pensions without Social Security coverage, you each have your own offset applied to your respective spousal or survivor benefits.