Confirmed: IRS Distributes Retroactive Payments to 3.2 Million Taxpayers
According to the Social Security Administration (SSA), the IRS has already distributed retroactive payments totaling millions of dollars to more than 1 million Americans.
A recently approved bill, called the Social Security Equity Act, has removed two clauses that previously restricted retirement benefits for specific workers such as teachers, firefighters, police officers, certain public employees, and their spouses.
More Than 3.2 Million Americans to Receive IRS Retroactive Payments
In addition to retroactive IRS payments dating back to January 2024, former President Joe Biden signed the law, which also permanently increases Social Security benefits for more than 2.8 million people. However, it could take up to a year to manage retroactive payments and adjust the benefit amounts, as initially reported to these groups.
In a March 4 press release, the SSA confirmed that more than $7.5 billion in retroactive payments had already been made to 1,127,723 people impacted by the legislative change. Currently, the average retroactive payment stands at $6,710.
Updated benefit amounts for those whose benefits increased due to the approval of the Social Security Equity Act will begin to apply in April. The Government Pension Offset (GPO) and Windfall Elimination Provision (WEP), both of which have been in place since the Reagan administration, were eliminated under the new law. All retired individuals affected by the WEP and GPO can expect to receive compensation. According to SSA estimates, this impacts around 3.2 million Americans.
Social Security benefits for individuals receiving pensions from public sector jobs that did not require Social Security contributions—such as state and federal employees—were reduced under the Windfall Elimination Provision (WEP). This reduction applied even if they were eligible for benefits and had contributed to Social Security through other jobs. Federal, state, and local government employees who retired without contributing to Social Security through their employment were denied spouse or survivor payments under the GPO.
In the press release, Acting Social Security Commissioner Lee Dudek stated, “President Trump made it clear that he wants the Social Security Equity Act to take effect as soon as possible. We are happy to deliver this to the American people after facing this challenge head-on.” John Hatton, vice president of policy and programs at the National Active and Retired Federal Employees Association, told Federal News Network: “We applaud the SSA’s announcement that they will begin disbursing payments to victims of WEP and GPO this week. This is significantly faster than expected and will benefit those who have waited decades for this assistance.”