Social Security Overpayment: All You Need To Know

Social Security Overpayment:  Have you recently received more Social Security money than your usual monthly amount? If you have, you may not be required to return that additional money because of new regulations implemented by the Social Security Administration concerning overpayments.

In March, SSA Commissioner Martin O’Malley introduced a four-step strategy to assist beneficiaries who unknowingly received overpayments and were not aware that their benefits had not actually increased. Normally, when a Social Security recipient is given more funds than they are entitled to, they are obligated to repay the excess amount, either through reduced monthly payments or as a lump sum, even if the error was caused by the SSA. These repayments can have a detrimental impact on individuals who depend on their monthly Social Security benefits to cover expenses such as housing and bills.

What exactly constitutes an overpayment?

An overpayment arises when the Social Security Administration (SSA) determines that you have been paid more social security or SSI benefits than you were entitled to receive.

How can a Social Security overpayment occur?

According to the Social Security Administration, there are a variety of factors that can lead to overpayments, such as failing to promptly report new employment or continuing to receive benefits while appealing a decision. The Social Security Administration deals with overpayments on an individual basis, therefore it is recommended to reach out to the agency if you receive a notification, especially if you believe it is incorrect. If there was a mistake, you have the option to file an appeal.

How can I determine if I have been overpayed?

The Social Security Administration (SSA) sends out a formal notification to individuals who have been given more in benefits than they are entitled to. This notification details the rationale behind the SSA’s belief in the overpayment, the exact amount that was overpaid, the available repayment choices, and the rights to appeal or seek a waiver.

What impact will the new regulations have on Social Security refund payments?

On March 20, 2024, Commissioner O’Malley proposed a four-step strategy to modify the process by which recipients who have been overpaid can reimburse the amount. As of March 25, the Social Security administration has changed its policy regarding the repayment of Social Security benefits. Previously, the administration would withhold 100% of the benefits if a claimant failed to respond to a repayment notice, but now the withholding amount will be 10%. Secondly, individuals filing claims will no longer be required to provide evidence of their culpability in causing overpayments. The responsibility for proving fault will now rest with the agency if it deems the beneficiary responsible for the overpayment. The repayment period will be increased from 36 months to 60 months, providing beneficiaries with additional time to repay their loans. This extended timeframe will allow individuals to pay back their loans more gradually, resulting in smaller deductions from their monthly payments. The agency will simplify the process of requesting a waiver for beneficiaries who are not responsible or unable to repay the money.

Social Security Clawback: Potential Overpayment Deductions from Your Monthly Payment!

How should I proceed if I receive more money than I am supposed to?

The Notice of Overpayment will inform you of the amount you were overpaid and instruct you to return the funds within 30 days. Stay calm! The initial step is to carefully review the notice

• Is the content accurate?
• Is the information accurate?
• Is the data correct?
• Is the content on point?
• Is the information precise?
• Is the information accurate and valid?
• Is the content reliable?

Attempt to determine whether the SSA’s claim that you were paid an excessive amount is accurate. Once you have understood the content of the Notice, there are various options available to address it.

If you believe you were not at fault for a Social Security overpayment you received, you can request a denial or file an appeal.

How to request a waiver for Social Security overpayments or file an appeal?

Here’s how to do it:

Waiver Request: If you agree that you were overpaid but do not believe you should repay the overpayment because it was not your fault or because you cannot afford it, you can request a waiver. There is no deadline for requesting a waiver, as long as you can prove it wasn’t your fault or it would be difficult to get your money back.

To request a waiver, you must file Form SSA-632. You can fill it out and mail it or drop it off in person at your nearest Social Security office. Do not use this form if you do not believe you were at fault and your overpayment is $1,000 or less. Instead, call 1-800-772-1213 or your local Social Security office to request a waiver. Your request may be processed by phone.

Submit your appeal: If you do not believe you were overpaid or the amount in the notice is correct, you may appeal.

Make sure you have notice from SSA and all supporting documents before submitting your application. When you’re ready, go to Secure.ssa.gov/iApplNMD/start, click “Start an Appeal,” and follow the onscreen instructions. Please note that you have 60 days from the date you received the original overpayment notice (5 days from the date of notice) to appeal.

What happens if I don’t repay my Social Security overpayment?

SSA will try to collect your overpayment even if you don’t take action to get your money back.

• The agency may seize funds you receive from other government agencies, such as tax refunds.
• SSA may recover overpayments from benefits you have not yet received, such as future Social Security retirement benefits.
• If you are employed, the agency may garnish your wages. This usually only goes this far if you are not currently receiving Social Security benefits and have not made an effort to pay them, or if you have set up a payment plan but have not paid them regularly.
• SSA can claim 15% of your net pay (paycheck after deductions for taxes, health insurance, etc.). If 15% means taking home less than 30 times the weekly federal minimum wage ($516 per week in 2024) or having your wages garnished for other reasons, it may cost less. You will receive a collection notice 60 days before SSA begins collecting your funds.
• The SSA may report your debt to the credit bureaus, which may affect your credit score.