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SS Fairness Act 2025 — WEP/GPO fully repealed

WEP Lump-Sum Tax Impact Calculator 2026

3.2 million teachers, firefighters and government workers received retroactive SS payments in 2025. Find out how much extra tax you owe — and if the lump-sum election saves you money.

Your 2025 Income
$
$
Average retroactive payment was $6,710. Check your SSA-1099.
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Find on your SSA award letter or ssa.gov account.
2025 Tax Impact
Tax without lump-sum
$3,013
Tax with lump-sum
$3,937
Extra tax from lump-sum
$924
You keep $6,776 net after tax out of $7,700 lump-sum
Your MAGI without lump-sum$50,400
Your MAGI with lump-sum$58,100
SS amount taxable (with lump-sum)$7,140
OBBB $6,000 senior deduction applied$6,000
Lump-Sum Election — check with your tax preparer

IRS allows you to use the lump-sum election on Form 1040 — treating the payment as if received in prior years. Estimated tax under election: $924 vs $924 normally.

What happened:

The Social Security Fairness Act (signed Jan 5, 2025) fully eliminated WEP and GPO. The SSA paid $17B in retroactive benefits to 3.1M people by July 2025.

The lump-sum covers Jan 2024 – the month your award letter was issued. It is fully taxable in the year received (2025 for most people).

File at ssa.gov if you haven't applied yet — retroactive to January 2024.

$6,000 Senior DeductionTeacher PaycheckSalary Calculator

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