Receiving your Social Security benefits is crucial for your financial stability. So, what happens when the amount you receive is wrong? While the Social Security Administration (SSA) has automated systems, mistakes can happen. With millions of Americans receiving benefits each month, occasional errors are bound to occur.
These payment errors fall into two main categories: underpayments (receiving less than you should) and overpayments (receiving more than you should). Often, these issues arise from failing to report life changes that affect your benefit amount, like a change in income, marital status, or the death of a family member.
Our guide will walk you through the steps to correct both types of errors, ensuring you receive the correct amount you are entitled to.
Understanding and Handling Overpayments
An overpayment occurs when the SSA sends you more money than you were supposed to receive. This is the more common type of payment error. If this happens, the SSA will send you a notice.
This official notice will explain:
- Why the overpayment happened
- The total amount you were overpaid
- Your options for repaying the amount
- Your rights to appeal the decision or request a waiver
It’s important to read this notice carefully and act promptly.
Option 1: File an Appeal
If you believe you were not overpaid or that the amount is incorrect, you have the right to appeal. You must file the appeal within 60 days of receiving the overpayment notice.
To start the process, you need to submit Form SSA-561-U2 (Request for Reconsideration). In your appeal, clearly explain why you disagree with the SSA’s decision. You can submit this form online or mail it to your local Social Security office. Be sure to include any evidence that supports your case.
Option 2: Request a Waiver
What if you agree that you were overpaid but believe you shouldn’t have to pay it back? In this situation, you can request a waiver by filing Form SSA-632-BK (Request for Waiver of Overpayment Recovery).
The SSA may grant a waiver if you can prove two things:
- The overpayment was not your fault.
- Paying the money back would cause you significant financial hardship, meaning you cannot afford basic living expenses like food and shelter.
Unlike an appeal, there is no deadline for filing a waiver request.
Option 3: Arrange a Repayment Plan
If you agree with the overpayment and can pay it back, but you can’t afford the repayment terms in the notice, you can negotiate a different plan. The SSA is often willing to arrange an affordable monthly payment.
To do this, you’ll need to complete Form SSA-634 (Request for Change in Overpayment Recovery Rate). This form asks for details about your income, expenses, and assets to help the SSA determine a reasonable payment amount.
What If You Ignore an Overpayment Notice?
Ignoring the notice will not make the debt disappear. If you don’t respond or make arrangements within 30 days, the SSA has several ways to recover the money.
They can:
- Withhold your entire monthly Social Security benefit until the debt is paid.
- Reduce your future federal income tax refunds.
- Garnish your wages if you are currently working.
- Report the delinquency to credit bureaus, which can negatively affect your credit score.
It is always best to address an overpayment notice as soon as you receive it.
Correcting an Underpayment
An underpayment happens when you receive less money from the SSA than you are entitled to. The SSA doesn’t always notify you about underpayments, so it’s essential to monitor your payments.
If you believe you’ve been underpaid, you need to contact the SSA directly. You can call them or visit your local office to report the discrepancy. Bring any documents that support your claim, such as award letters or bank statements.
Once the SSA confirms the underpayment, they will calculate the amount owed and issue a lump-sum payment for the difference.
It’s important to note that if you have any outstanding overpayments, the SSA will likely use a process called “netting.” This means they will subtract the amount you were overpaid from the underpayment amount before sending you the remaining balance. You will receive a notice explaining any netting action.
How long do I have to appeal an overpayment decision?
You have 60 days from the date you receive the overpayment notice to file an appeal (a Request for Reconsideration). If you miss the deadline, you may still be able to appeal if you have a good reason for the delay.
What happens if my request for a waiver is denied?
If your waiver request is denied, you have the right to appeal that decision. You would file a Request for Reconsideration (Form SSA-561-U2) to have a different person review your case.
Can the SSA take money from my bank account for an overpayment?
The SSA will not directly take money from your bank account without your permission. However, they can withhold your federal benefits, intercept your tax refunds, and garnish your wages to collect the debt.
How do I know how much my Social Security benefit should be?
You can check your benefit amount on your initial award letter from the SSA or by logging into your personal my Social Security account online at SSA.gov. This portal provides detailed information about your benefit history and payment amounts.
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