The Social Security Administration (SSA) has announced significant changes to its policy regarding benefit overpayments that may affect recipients starting in July. Under the new guidelines, up to 50% of a beneficiary’s payment could be withheld if they have been overpaid. This approach falls under the Treasury Offset Program (TOP) and will continue until the individual repays the overpayment amount.
Previously, during the COVID-19 pandemic, such withholdings were paused. Although the SSA reinstated the withholding two years ago at a reduced rate of 10%, the upcoming policy change marks a notable shift. It’s important to highlight that initially, the SSA had considered withholding 100% of a check until the overpayment was settled, but the decision to limit that to 50% offers some relief to beneficiaries.
The SSA has begun notifying individuals affected by overpayments with letters sent out starting April 25, giving recipients a 90-day notice period that will conclude around July 24. Acting Commissioner Lee Dudek emphasized that resuming TOP collections is essential for maintaining the integrity of the program and being responsible stewards of taxpayer funds.
In the context of historical data, Social Security reported approximately $72 billion in improper payments from 2015 to 2021, which primarily consisted of overpayments. This amount represented less than 1% of the total $8.6 trillion in benefits disbursed during that period, highlighting the agency’s effort in managing errors. A federal report noted that there are still $23 billion in uncollected overpayments from past years.
For those struggling to repay their debts, the SSA provides options to appeal or request a payment plan. Beneficiaries who believe they are not at fault for the overpayment can also reach out to the SSA about obtaining a waiver.
This policy change underscores the SSA’s commitment to accountability while providing avenues for beneficiaries to navigate their financial responsibilities. It’s essential for recipients to stay informed and proactive in addressing any overpayment issues to avoid financial strain.