Saturday, August 1, 2015

A county pension plan and Social Security


DEAR HARRY: I've gotten contradictory answers to a question that my fellow employees and I have been pondering. We work for a suburban Philadelphia county. Our employment will provide us with a modest pension. We know that sometimes a government pension can have an impact on the amount of Social Security we can receive. However, our earnings are subject to the SS tax. As a result, we don't think that our SS pensions should be reduced. First, we contacted the brother of one of our co-workers (a CPA). He told us that we were wrong, and that the SS pensions would be reduced anyway. We then called SS and got the answer that we are right. Who's on first here, Harry?

WHAT HARRY SAYS: In general, the people at your SS office are on the ball; so are most CPAs. This time, the CPA gave you an off-the-cuff answer without checking it out. The Internet is a great place to find answers, and this is no exception. There will be no reduction because the SS tax is being collected on your current salaries. The rule was set up to prevent "double-dipping" at the government fountain. In fact, most government plans give you more than the SS reduction that accompanies them, so you'd probably be better off if you had your county plan instead of SS.


Email Harry Gross at, or write to him at Daily News, 801 Market St., Philadelphia, PA 19107. Harry urges all his readers to give blood. Contact the American Red Cross at 800-Red Cross.

Daily News Personal Finance Columnist
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