What Happens If I Get an Overpayment of Social Security Disability?

You might receive an overpayment from Social Security for several reasons, but you probably need to pay it back. Here's how to avoid trouble.

By , Attorney · UC Law San Francisco

Once you're getting regular monthly disability benefits from the Social Security Administration (SSA), at some point, you could receive an overpayment. An overpayment is simply when you receive more money for a month than the amount you should have gotten.

Sometimes an overpayment is the result of a clerical error at the SSA. But it's not unlikely that if you get an overpayment, it's your fault—possibly because you failed to promptly notify Social Security about a change in your circumstances.

If you receive an overpayment from Social Security, you can't just keep the extra money. You're required by law to pay it back.

Why Social Security Overpayments Happen

The most common reason for overpayments is that your situation changed (and the change affects the amount of your monthly disability check). And you might not have notified Social Security of the change quickly enough, or they didn't act on it quickly enough. Here are examples of when this can happen:

  • You got married.
  • A roommate moved in or out (if you collect SSI, Supplemental Security Income).
  • A child moved out.
  • You started working.
  • You made more income than you estimated for the month.
  • You started getting other benefits, such as workers' compensation, black lung benefits, or a government pension.
  • You started receiving child support.
  • You received more resources or income than is allowed (if you collect SSI).
  • You're no longer disabled.
  • You were convicted of a crime or went to prison.

In some cases, you might have reported the change, but the SSA delayed decreasing your monthly check. Note that you need to report any change within 10 days of the month in which it happened. (If you report a change by telephone, write down the name and number of the Social Security employee who took your information.)

What Should You Do If You Receive an Overpayment from Social Security?

If you know that you've received a check or direct deposit for more money than you should be getting, don't cash the check or spend the extra money deposited in your account. Instead, you should call Social Security at 800-772-1213 (TTY: 800-325-0778) and ask why the monthly amount is higher than usual. It's better to catch the problem early so that the overpayment doesn't grow and grow with more monthly payments. A Social Security representative can discuss your repayment options with you at that time.

What Social Security Will Do When an Overpayment Is Found

If the SSA determines that you've been overpaid, the agency will send you a notice telling you how much you were overpaid and why you weren't entitled to the amount of money you received. Social Security will ask for a full refund within 30 days of the notice.

If you're currently getting SSI and you don't pay back the overpayment in full, the overpayment notice will propose deducting money from your SSI monthly benefit (up to 10% of your total income) until you've repaid the entire overpayment. The notice you receive from Social Security will include the date when the withholding will start (which should be at least 60 days from the date of the overpayment notice).

If you're currently receiving SSDI and you don't back the overpayment in full, Social Security will stop paying your benefits (that is, withhold the entire amount of your monthly check or direct deposit) until the overpayment is paid off. The SSA will begin holding back your benefits 30 days after the date of the overpayment notice.

The overpayment notice you receive will also explain how you can appeal the overpayment—that is, ask Social Security to review and reconsider whether there was in fact an overpayment. The letter will also tell you how to ask for a waiver so that you might not have to pay all or some of the money back.

Your Options After Receiving a Social Security Overpayment Notice

When you receive an overpayment notice from Social Security, you can respond in several ways. If you agree that you were overpaid and you're still receiving SSDI or SSI benefits, you can simply allow the repayment terms in the notice to take effect. If you're no longer getting Social Security benefits or you want to repay the entire overpayment in one lump sum, you can do so in one of the following ways:

  • Pay the balance by credit card, debit card, or electronic check from your bank account on the pay.gov website (search for "Social Security").
  • Use your bank's online bill pay feature to make a payment to the "Social Security Administration."
  • Send the SSA a check for the entire amount of the overpayment within 30 days.

If you can't repay the overpayment within 30 days (or don't believe you should have to repay it), you have three options. You can:

  • appeal the overpayment
  • request a payment waiver, or
  • arrange a payment plan.

The overpayment notice will include instructions for each option.

Request for Reconsideration—Appealing the Overpayment

If you believe you weren't overpaid and that you shouldn't have to repay any money to Social Security, you can request a "reconsideration." This is the first level of appeal. You'll need to explain to Social Security why you believe you weren't overpaid or why the amount of the overpayment is incorrect.

You have 60 days to file an appeal online or file Form SSA-561, Request for Reconsideration at your local Social Security office. If you make the request within 10 days of the date on the overpayment notice, Social Security can't stop or reduce your monthly benefits until the agency makes a decision on your appeal.

Request an Overpayment "Waiver of Recovery"

If you agree that you were overpaid, but you can't pay back the money and feel that the overpayment wasn't your fault, you can ask for a full or partial waiver of the repayment. You can't request a waiver online at this time. Instead, you'll need to fill out Form SSA-632, Request for Waiver of Overpayment Recovery, and submit it to Social Security.

Generally, for Social Security to grant an overpayment waiver, you'll need to show that:

  • the overpayment wasn't your fault, and
  • you can't afford to pay it back

To prove your case for a waiver, Social Security will need to be convinced that repaying the money would create a hardship for you. You'll need to show the SSA proof of your income and all the bills you must pay each month.

Request a Social Security Payment Plan

If you agree that you were overpaid, but you can't afford to repay Social Security at the rate described in your overpayment notice, you can ask the SSA to accept a smaller amount each month until the overpayment is paid back. You'll need to file a Request for Change in Overpayment Recovery Rate (Form SSA-634) with Social Security.

Once Social Security sets a new payment amount, if you're still receiving SSI or SSDI benefits, the SSA will withhold the payment amounts from your disability checks. If you're no longer receiving benefits, you can arrange to make monthly payments to Social Security.

What Happens If You Don't Pay Back a Social Security Overpayment?

If you appeal and lose, or file a waiver request and are denied, Social Security will expect to get its money back. If you're still receiving disability benefits, the SSA will simply withhold part or all of your monthly check (or direct deposit) until the overpayment is fully repaid. But if you're no longer eligible for disability benefits (say you neglected to tell Social Security you had recovered and you continued to receive disability benefits unlawfully), the SSA can collect from you for the rest of your life, if necessary, to recover the entire overpayment.

Social Security can also collect the overpayment from any future federal tax refund you're supposed to receive. Social Security can also try to collect the overpayment by garnishing your wages and the agency will report your failure to pay to the credit bureaus.

The SSA can also withhold money from your future Social Security benefits—including retirement and/or disability benefits (if you qualify for disability again).

If your waiver request or appeal is denied, and you can't make the payments, consider contacting a Social Security attorney.

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