On January 5, 2025, a major shift in Social Security policy became official. The Social Security Fairness Act—long discussed and debated—was finally enacted. And for millions of Americans, especially those in public service or government work, this legislation marks a major financial turning point.
At LaTour Asset Management of Springfield, we’re already working with retirees and pre-retirees to help them understand how this change may increase their Social Security income and impact their tax situation, impacting how they approach retirement planning altogether. If you’ve ever been affected by the Windfall Elimination Provision (WEP) or Government Pension Offset (GPO), keep reading—this is information you need.
- Social Security Benefits Are Increasing for Many Retirees
With the elimination of the WEP and GPO, those who previously saw their Social Security reduced due to a pension from non-covered employment are now receiving larger monthly checks. Here’s what this means in real terms:
- If you held a government or public sector job that didn’t pay into Social Security, but also worked in covered employment, your benefit is no longer reduced.
- If you’re a spouse or surviving spouse who was penalized by the GPO, your spousal or survivor benefit may now be significantly higher.
For many retirees in Springfield and across Missouri, this could translate to hundreds of additional dollars each month. That’s meaningful financial relief.
- Retroactive Payments Are in Motion
Alongside the increase in benefits, the Act includes retroactive adjustments dating back to January 2024. If you were already drawing Social Security last year and were affected by WEP or GPO, you may be eligible for a lump-sum back payment. Not sure if you qualify? That’s exactly the kind of detail we help our clients sort out.
- Your Retirement Plan May Need to Change
Increased monthly benefits can ripple through your broader retirement strategy. Now’s the time to revisit the details:
- Should you adjust your IRA withdrawal strategy to reduce taxes and preserve assets?
- Does the higher Social Security benefit change your timeline for retirement?
- Will the new income impact your Medicare premiums or your taxable income bracket?
We can help. At LaTour Asset Management of Springfield, we take a complete look at your income plan, not just one piece of the puzzle.
- Bigger Benefits, Bigger Tax Considerations
As monthly benefits grow, so does the likelihood of your Social Security becoming partially taxable—especially if you have other income sources. Be aware of the following:
- You may now cross the taxable income threshold, triggering taxes on up to 85% of your Social Security income.
- Higher combined income can push you into a higher marginal tax bracket.
- Your Medicare Part B or Part D premiums could increase due to income-based surcharges.
We recommend meeting with a financial professional to update your tax strategy now that benefits are changing.
- This Is Especially Relevant for Specific Groups
Not everyone will see an increase—but for those who do, the difference is meaningful. You are likely impacted if you fall into any of these categories:
- First responders and public safety workers with a combination of covered and non-covered employment.
- Retired federal, state, or local government workers under systems like CSRS.
- Missouri school teachers.
- Spouses or widows/widowers of those with non-covered positions.
If you’re unsure, don’t guess. Now’s the time to get clarity—and a plan.
What Should You Do Now? Call Us Right Away
With the Social Security Fairness Act now fully in effect, retirees have new opportunities—but also new responsibilities. You owe it to yourself to ensure your financial plan reflects the updated rules and the increased income that may come with them.
LaTour Asset Management of Springfield helps people in Springfield, MO and the surrounding region take control of their retirement strategy with clarity and confidence. Call us today at (877) 888-5724 to talk through how this law may affect your benefits, tax strategy, and long-term retirement income. Don’t wait—this is your moment to adjust and move forward.
