You asked whether retired teachers are eligible for Social Security, for an explanation of the Social Security benefit reductions that may apply to them, whether the reductions are the result of state law, and where besides Connecticut teachers are not covered by Social Security.

SUMMARY

Connecticut public school teachers are not covered by Social Security for their public school teaching. Therefore, they are ineligible to receive Social Security benefits based on that work. Instead, they are members of the Teachers' Retirement System (TRS), which is independent of Social Security.

A retired teacher may still claim Social Security benefits based on his own or his spouse's covered employment. But in those cases, their Social Security benefits are generally reduced or eliminated. Federal law requires the reductions and the General Assembly has no authority to change them.

Thirteen other states have teacher retirement systems that are independent of Social Security. In some cases, those systems cover other public employees as well.

TEACHER ELIGIBILITY FOR SOCIAL SECURITY

Connecticut public school teaching service is not covered by the federal Social Security system. Teachers and school districts make no contributions to Social Security for that work so they cannot collect Social Security benefits based on it. Instead, the state provides retirement benefits to public school teachers through the state Teachers' Retirement System.

Retired teachers may be eligible for Social Security if they have other work covered by Social Security or on the basis of a spouse's work history. But in such cases, their Social Security benefits are reduced because of their TRS pensions. The spousal benefit reduction is called the "offset provision" and the reduction in benefits for other work is called the "windfall provision." The reductions are designed to keep the Social Security system from paying people benefits that are higher than their financial circumstances warrant because most of their earnings are outside the Social Security system.

Offset Provision

The offset provision reduces a spousal Social Security benefit by two-thirds of the amount of any government pension the person receives for work not covered by Social Security. If the government pension is high enough, it can offset the person's entire Social Security benefit.

For example, suppose a person receives a $1,000-per-month TRS pension and is also eligible for $600 per month in Social Security spousal benefits. His offset is $660 per month, which is more than his total Social Security benefit, so he receives no Social Security.

The offset applies to anyone who qualifies for a TRS pension on or after December 1, 1982.

Windfall Provision

The windfall provision changes the formula used to figure the Social Security benefit. Instead replacing 90% of the first $561 of the person's normal wages, 32% of the next $2,820, and 15% of the remainder, the windfall provision replaces only 40% of the first $561, thus reducing the overall benefit. (These amounts apply for a worker who turned 62 in 2001. They are adjusted annually.)

For example, a worker not receiving a TRS pension whose average covered earnings were $3,500 per month would be eligible for a Social Security benefit of $1,509.30 compared to $1,228.80 for a TRS member with the same covered earnings.

There are several exceptions to these rules and the Social Security reduction cannot be more than 50% of the part of a pension attributable to uncovered earnings after 1956.

The windfall provision applies to TRS members who became eligible for a pension on or after January 1, 1986. Because of a four-year phase-in, the full effect applies to those who become eligible for TRS pensions after December 30, 1989.

Social Security Administration Publication 05-10045 explains the windfall provision in more detail.

STATES THAT EXCLUDE TEACHERS FROM SOCIAL SECURITY

Fourteen states, including Connecticut, have pension systems for teachers outside of Social Security. The other states with "independent" teacher retirement systems are: Alaska, California, Colorado, Illinois, Kentucky, Louisiana, Maine, Massachusetts, Minnesota, Missouri, Nevada, Ohio, and Texas.

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