What if Social Security Overpays Me?

What happens if Social Security contacts you and says that they have given you too much money?  What if they expect you to pay back that money?  What does this mean, and what do you do now?

It can be hard to believe that after fighting so long and hard to receive disability benefits that Social Security can send you a simple piece of mail that says that you’ve been given too much money.  This is called a Notice of Overpayment.  There are many reasons why this could have happened.  Probably the most common reason is that you simply forgot to report some change in your life to Social Security such as getting a part-time job, a change in marital status, or maybe your child moved out of the house.  It is also possible that your income was more than you estimated or maybe Social Security made a mistake when they determined your benefits.  Even if you did have a change in your life and you reported it to Social Security, there may have been a delay in changing your monthly benefits.

If you do happen to receive a Notice of Overpayment, it is very important for you to read the notice carefully.  It should tell you what amount you were overpaid.  It will also tell you to pay Social Security back that amount within 30 days.  This means you need to figure out what is going on quickly.  Double check the dates and amounts that the notice gives you and try to figure out if you were really overpaid the total that Social Security says. There are a couple different actions you can take once you know what is going on, one of which is to ask for a waiver of overpayment.

If you agree that you were overpaid, you can still ask SSA to waive the overpayment so that you don’t have to pay it back.  If you think that the overpayment was not your fault AND you can’t afford to pay the money back, you should ask for a waiver.  Get a form called Overpayment Recovery Request (you can get this online or ask for one at your local Social Security office). This form asks you questions about whether you reported the change or reason for the overpayment to SSA and whether you knew that you should report the change. It also asks questions about your income.  You must show both that the overpayment was not your fault and that you do not have enough money to pay it back.

If the overpayment is $1000 or less, you did not cause the overpayment by making a false statement, and you request the waiver, Social Security must automatically waive your overpayment.  If you meet all three of these qualifications, it should be a fairly easy process.  If you do not meet all three, SSA may not give you a waiver.  But don’t worry.  You can then ask for an administrative hearing.  If they still deny the waiver at that point, you can ask for an appeals council to review your request.  If you are still not able to get a waiver, you can take the case to court, but make sure you have a lawyer for this step.

The most important part of the waiver is proving that the overpayment is not your fault.  Some reasons that may help show this are: you have trouble reading or trouble understanding directions, you don’t remember the reporting rules from when you applied for disability, or that you believe you already reported the change to SSA.  You must be able to prove this in order to be considered for the waiver at any stage.

Whether you decide to ask for a waiver or you choose to do something else about your Notice of Overpayment, the most important things you can do are to make sure you understand the notice and to act quickly.  If you just set the notice aside, Social Security will start taking payments out of your disability checks to pay back the overpayment.  Therefore, the best thing you can do to protect yourself is to be prepared!