Social Security Overpayment: The Repayment Rule Changes Once Again

If you receive more money than expected from your Social Security payment, don't assume it's a gift from the Social Security Administration. More than likely, you received an overpayment because of changes in your account that either weren't reported on time or to another mistake by the SSA itself. You will have to repay the overpayment amount.

It's understandable if you're confused about what's happening -- there have been some back-and-forth changes. At first, the Social Security Administration rolled back rules so that if an overpayment occurred, it would withhold 100% of your payments until the overpayment was returned -- a full walk back from previous measures designed to ease the repayment timing for beneficiaries. Now those rules are changing again, for the better. 

Below, we'll go over why overpayments happen and what the updated rules are if you receive one.

For more, don't miss the Social Security payment schedule and how to apply for Social Security Retirement benefits.

How do Social Security overpayments even happen?

Social Security overpayments can happen in a few ways. If you start a new job while receiving benefits and report it to the administration, your monthly benefit check could be reduced -- and if you make more than the yearly earnings limit, you may not get a check at all for that month. 

But if you got a job and didn't notify the administration about it, you may receive an overpayment. 

Another way overpayments could happen is if you've filed an appeal and are still receiving payments. More on appeals below. In other cases, overpayments are simply an error on the SSA's part. 

The SSA issues "Emergency Message" to staff about overpayments

In March 2024, the SSA changed the amount taken from Social Security payments if an overpayment occurred -- instead of withholding 100% of your next payment, it would withhold only 10%. This not only gave recipients more time to pay back the overpayment, but it eased the potential devastating financial consequences if your benefits payment was your only source of income. 

However, in March of this year, those rules were erased (including the announcement of the updates) and the old policy was reinstated: retain 100% of a recipient's benefit payment until the overpayment was returned. The updated policy went into effect March 27. 

That's all changed yet again, with the SSA backing down on withholding 100% of a recipient's benefit payment. In an "Emergency Message" to staff late last month, the SSA announced that it would be changing the withholding percentages for individuals receiving Title II benefits (Retirement, Disability or Survivors). Instead of retaining 100% of a payment, the SSA will now only withhold 50% until the overpayment is paid back. While this is certainly an improvement, the impact could still wreak havoc on beneficiaries financially. 

There's one other wrinkle to be aware of: If you receive an overpayment, when the Administration sees the error it will send a formal notice for the overpayment. Beneficiaries have 90 days to contact the SSA to either request a lower withholding rate, reconsideration or a waiver. If contact isn't made within this time, the 50% withholding will go into effect. These changes went into effect April 25.

Meanwhile, individuals receiving Supplemental Security Income will still only have 10% of their payments reduced when an overpayment occurs.

How do I request a waiver for a Social Security overpayment?

If you've been overpaid by more than $1,000 and you don't believe you should have to repay the overpayment -- either because you don't think it's your fault or do not have the ability to repay it -- you can request a waiver. There's no time limit as to when you were overpaid and when you need to request a waiver -- you'll just need to show that the overpayment wasn't your fault or it would create a financial hardship for you. 

To request a waiver for a payment of more than $1,000, fill out an SSA-632 form and either mail it or drop it off at a local Social Security office. 

If you were overpaid less than $1,000 and you believe you were not at fault for it, you can request a waiver by calling 1-800-772-1213 or by visiting your local Social Security office to have the request processed.

When to file an appeal vs. when to request a waiver for overpayments

If you don't believe you were overpaid, or if you receive a notice and you think the amount is incorrect, you can file an appeal. Unlike requesting a waiver, an appeal has a time limit for when you can file: You have 60 days from when you originally received the overpayment notice. 

Before you can file an appeal, you'll need to have a few things ready. This will include the overpayment notice you received, along with any legal forms, documents or written statements you have related to the situation. If you have a personal appointed representative, have their contact information handy. 

To file an appeal, head to the Non-Medical Appeal page on the SSA website and click Start an Appeal and go through the steps. 

For more, don't miss the reports that the SSA is harder to contact after the February 2025 layoffs.