On March 7th, the Social Security Administration (SSA) announced that starting on March 27, 2025, it will bring back the rule of taking 100 percent of benefits to recover overpayments. If someone has received an overpayment, they are required to repay the entire amount.
For the past year, people receiving Social Security benefits have not had to deal with this strict rule, as it was changed to only take 10 percent of their payments in early 2024. This switch back is expected to collect about $7 billion over the next ten years. The SSA reported that it made nearly $72 billion in mistakes with payments, mostly overpayments, from 2015 to 2022.
Even though this is less than 1 percent of all benefits paid during that time, by the end of 2023, the SSA still had $23 billion in unpaid overpayments. However, the 10 percent withholding rate for Supplemental Security Income benefits will stay the same.
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What Causes Social Security Overpayments?
Overpayments can happen for different reasons, like if a beneficiary forgets to update their income or personal situation. Sometimes the SSA makes a mistake in calculating payments. No matter who is at fault, recipients of overpayments often need to return the funds, as Social Security benefits are supported by taxpayer dollars.
If someone has a long-standing overpayment, it can be tough to pay it back. If you get a notice about an overpayment after March 27, 2025, and can’t afford to pay it all at once, you should reach out to the SSA at 1-800-772-1213 or visit your local SSA office.
You can pay back the overpayment using a credit card, online bill pay, or a check. For more details on how to repay overpaid benefits, check the SSA website. The SSA can also take money from your federal tax refund or your paycheck if you are no longer receiving benefits and fall behind on a repayment plan. If you do not keep up with repayments, it can be reported to credit agencies.
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Here are some tips to help avoid Social Security overpayments:
- Report any changes in your living situation.
- Pay attention to how your payments are calculated.
- Ask about any changes you notice in your benefits.
Contact a Social Security Lawyer Near You
If you are not able to work due to a disability, you may be eligible for Social Security Disability. We handle cases from the initial application stage through administrative law judge (ALJ) hearings and federal court. Contact us today for more information.
