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What to Do About Social Security Overpayments

What to Do About Social Security Overpayments

An overpayment occurs when you receive more in monthly benefits than you are supposed to. The amount of that overpayment is the difference between what you were owed and what you received.

There are a number of reasons why overpayments occur, including your failure to report changes to Social Security Administration (SSA) on time or at all. Your living situation or your marital status could change, your income is more than you estimated, or you have more resources than you are allowed. Additionally, overpayments could be caused if SSA incorrectly calculates your benefits based on incorrect or incomplete information in your earnings history. And if you are no longer disabled but continue to collect benefits, those payments are overpayments.

If you have been overpaid, SSA will send you a notice explaining the overpayment and requesting a full refund within 30 days. The notice will suggest that SSA withhold the overpayment and state the month when the proposed withholding will start. It will also explain your appeal rights if you disagree with SSA and explain how you can ask SSA for a waiver.

If you believe that SSA made a mistake and you were not overpaid, you need to request a reconsideration. If you request the reconsideration within 10 days from when you receive the notice, you will continue receiving payments at their current rate until SSA makes a determination; otherwise, you have 30 days from the day you receive the notice to file your request for reconsideration. Should you ignore the notice entirely, SSA will begin withholding money from future payments.

If you think that you have been overpaid but it was not your fault, you can ask for a waiver of overpayment. To receive one, you need to show that it was not your fault you were overpaid and that you cannot pay back the overpayment because you need the money to meet your ordinary living expenses. SSA may require you to submit your bills to prove that paying them back would be a hardship.

In the event that SSA denies your waiver request, you can request a reconsideration of that decision. But if the decision stands, you will likely have to repay the overpayment. If you cannot afford to repay SSA in a lump-sum payment, you may be able to arrange a payment plan and pay back SSA a little at a time.

If you were overpaid and are no longer receiving benefits, you must send SSA a check for the full amount within 30 days of receiving the notice or set up a payment plan. If you do not repay SSA, the agency can take the funds from your tax refund check, garnish some of your wages before you receive your paycheck, take future Social Security payments, and notify credit bureaus of your failure to repay.