Social Security Administration Benefits
As a PERS member, your PERS pension benefit may reduce the amount of benefits you are entitled to under Social Security if you did not pay Social Security taxes during your PERS employment. If you paid Social Security taxes during your PERS employment, there will be no reduction to your Social Security benefits. Keep in mind, not all PERS employees participate in Social Security. If you are unsure if you paid Social Security taxes, please contact your employer.
For those who did not pay Social Security taxes while working for the State of Alaska, local government, or school district, there are two laws that may reduce your Social Security benefits:
- The Windfall Elimination Provision, which affects the way your Social Security retirement benefits are calculated.
- The Government Pension Offset, which affects Social Security benefits you may be eligible to receive as a spouse or widow/widower.
Windfall Elimination Provision
The Windfall Elimination Provision affects people who have earned a pension from the PERS and did not pay Social Security taxes during their employment, but who also worked at other jobs where they paid Social Security taxes long enough to qualify for retirement benefits. If you are subject to the provision, a different formula is used to calculate your Social Security retirement benefits to prevent a windfall in benefits.
The provision does not apply if you first became eligible to retire prior to 1985, or if you have 30 years of “substantial” earnings during your Social Securitycovered employment. For more information regarding the Windfall Elimination Provision, please contact your local Social Security office and request publication no. 05-10045. You can also call the Social Security Administration at (800) 772-1213 or visit their website at ssa.gov.
Governmental Pension Offset
The Governmental Pension Offset affects Social Security benefits you may be eligible to receive as a spouse or widow/widower. Under the offset provisions, some or all of your spouse or widow/widower’s Social Security benefit may be offset by your PERS pension if you did not pay Social Security taxes during your employment. For more information regarding the offset provision, please contact your local Social Security office and request publication no. 05-10007. You can also call the Social Security Administration at (800) 772-1213 or visit their website at ssa.gov.
If you have worked exclusively for the State or a participating employer for more than 10 years, you will not be eligible for Social Security disability, since the State and other participating employers do not participate. Social Security disability is only available if you have enough Social Security credits. Generally, you need 40 credits, with 20 earned in the last 10 years. In order to protect yourself and replace the disability benefits for which you may no longer be eligible under Social Security, the State offers voluntary supplemental benefits (VSB), for short-term and long-term disability. If your employer does not participate in the State’s VSB plan, be sure to inquire with your employer if there are other options available.
Short-term disability (STD) protects you in the event of a brief absence from work. It can also fill in the waiting (elimination) period before long-term disability benefits begin. STD benefits can begin after you’ve been disabled and off work for 30 days. If you are still in pay status from accrued or donated leave at that time, benefits begin after you exhaust all paid leave. STD pays 60% of your base salary up to a maximum of $2,500 per month, less other income (see below). Benefits continue as long are you are disabled, for up to 180 days from the date of disability.
Long-term disability (LTD) protects you in the event of an extended disability. Benefits begin after you’ve been disabled and off work for at least 180 days. Benefits continue for as long as you remain disabled—up to age 65 if you are disabled before age 60 or for up to 4 1/2 years if you are disabled after age 60. You may elect a plan that covers either 50% or 70% of your salary, less other income.
For further information on short-term and long-term disability insurance through the VSB plan, visit our website here.