Social Security Overpayments: When Social Security Says You Owe Them Money

Overpayments happen when Social Security determines that they paid you too much in Social Security or SSI. Sometimes it is because they believe that you were no longer eligible for the benefit. This can happen if you work and make over the amount that Social Security calls “Substantial Gainful Activity.” It can also happen if you go to jail and Social Security keeps sending you checks. There are many reasons why Social Security will decide that they have paid you too much money, and sometimes it can involve things that happened many years ago.

Social Security overpayment letters are supposed to talk about why you owe the money and how much you owe, but the letters are often very short and can feel like they come out of nowhere.

The overpayment letter from Social Security will usually talk about two options you have. One is to file an appeal called a “Reconsideration,” to argue that you do not owe any money Another is to ask for a “waiver,” which can allow you to avoid paying back the money if you do owe it under their rules.

If you do nothing, Social Security will start to collect the overpayment from your future Social Security or SSI checks. They can also sometimes try to collect from you in other ways if you no longer get monthly checks from them.

To collect an overpayment, Social Security usually takes payments out of your regular checks.

If all you receive is SSI, the rule for many years has been that they can only hold back 10% of your check. In 2025, that would be about $94 a month for most folks who receive SSI. If you want to pay off the overpayment faster than that, you can set up a plan to pay more, but Social Security can’t make SSI recipients pay more than 10% of their check unless Social Security can show that you lied to them or committed some kind of fraud.

In mid-2024, Social Security ruled that the 10% standard rate now also can apply to folks who receive Social Security retirement or disability checks. That new rate was supposed to be applied to all new overpayments starting that year. If you were charged with an overpayment at that time, you may have been started on a repayment rate of 10%. If you are already set up for a 10% deduction, it should stay that way unless you ask Social Security to change it.

However, Social Security changed that rule again in April 2025. Now the standard deduction rate is set at 50% of your check. If your regular Social Security disability or retirement check is $1400, they will automatically start taking $700 per month out. If you are on the lower 10% reduction for an older overpayment but then pick up a new overpayment, you will lose your eligibility for the 10% reduction and you will be charged the 50% rate instead.

If you are on Medicare and you receive “Extra Help” to pay the full amount of your Part D prescription drug plan, you can also get a special overpayment repayment rate of just $10 a month. You also have to call Social Security to request that rate if you are currently paying more than that. You can also ask for a reduction to $10 a month if you receive disability or pension benefits from the VA or if you are on TANF (Temporary Assistance to Needy Families).

If Social Security is collecting money from your check, you are considered to be paying off the overpayment. They will not try other collection methods so long as they are making those deductions from your monthly checks. Those other methods are only used on people who do not have regular monthly checks to collect from.

Yes. If there are no Social Security or SSI checks to collect from, Social Security can grab any tax refund check you are due from the IRS. This is called the “Tax Refund Offset” and it is done by Social Security in partnership with the US Department of the Treasury, which runs the IRS. They can continue to grab your annual tax refunds until the overpayment is paid off.

In rare cases, Social Security can be more aggressive. Much like unpaid child support, Social Security overpayments can lead to “garnishment,” where Social Security grabs part of your wages directly from your work. They can take up to 15% of your pay once they put an order for garnishment in place with your employer. If Social Security plans to try “garnishment,” they are supposed to send you a letter to warn you, at least 60 days before they start taking money from your wages. You can talk with Social Security to ask them to garnish less than the maximum of 15%.

Social Security will not try to garnish wages if they are also taking money out of your Social Security or SSI checks. They will also not garnish wages if you are taking part in Social Security programs called “Ticket to Work” or “PASS-Plan to Achieve Self-Sufficiency.” Those programs are in place to help people on disability return to full-time work.

If the overpayment is over $3,000 and Social Security has decided that they can’t get it back from you any other way, they can report it to the credit bureaus, where it will show up as an unpaid debt on your credit report. They can only do this if it has been less than 6 ½ years since they first decided that you have an overpayment.

Social Security also has the power to sue you in court to try to collect the debt, but they must do so:

1. within six years of when they first decided that you have an overpayment; or
2. if you appeal their decision that you had an overpayment, within one year of your losing that appeal.

Yes. If you have serious questions about how Social Security came up with the overpayment amount, or if you don’t think that you did anything to cause the overpayment, you can file an appeal called “Reconsideration.”

Be sure to file your appeal on time, within 65 days of the date on your letter. There are three methods for filing:

• Go to the Social Security website.
• Call the national Social Security call center at 1-800-772-1213.
• Fill out and file the paper form SSA-561.

It sometimes takes the local Social Security office a long time to make a decision on the appeal. Social Security is usually supposed to set up a meeting for you at the local office to hear what you have to say, but sometimes they make a decision on the appeal based on what is already in the file.

The deadline for the appeal is 65 days from the date on the overpayment letter. If you want to appeal, it is very impotent to do so before this deadline. If you file an appeal after the 65 days are up, Social Security does not have to accept it.

Determining the deadline: One little trick is to add two days and two months to the date on the letter, because that will always be within 65 days. If the date on the overpayment letter is October 12, for example, you know you have until at least December 14 to file the appeal on time.

For your initial Reconsideration request, no. If you file for Reconsideration on time, Social Security should immediately stop any collections until they make a decision on your appeal. They cannot charge interest on the overpayment amount, so you don’t owe more for the time that the appeal is pending.

If your Reconsideration is denied and you choose further appeals, you may need to pay while waiting on the outcome.

If Social Security denies the Reconsideration, there are other appeals you can file after that, including to have your case heard by a judge who specializes in Social Security issues. However, if you appeal the overpayment to a higher level, Social Security can start collecting the overpayment even while the next appeal is pending.

You can also ask for a waiver that forgives overpayment if you were not at fault and repaying the amount would be a hardship.

No. If you file for Reconsideration or later for a hearing with a judge, you are allowed to have a lawyer or someone else represent you in your case, but Social Security will not provide anyone for you.

However, sometimes local legal aid agencies help with overpayment appeals for free.

Filing for a waiver asks Social Security to forgive the overpayment debt. If you win an appeal, the overpayment debt is wiped out. Sometimes, though, you may agree that there was an overpayment, or that the overpayment is small enough to be routinely forgiven, or the 65-day appeal deadline has passed. In these cases, you may want to ask Social Security to grant you a waiver that forgives the overpayment.

You can file for a “waiver” of the overpayment at any time. It does not have to be within 65 days.

Social Security now routinely waives overpayments of less than $2,000. If the overpayment letter says you owe less than that, you can ask Social Security for a waiver without filling out any specific form. Just call the national Social Security call center at 1-800-772-1213 or visit the local Social Security. Ask them for an “Administrative Waiver,” and they should give it to you unless Social Security believes that there is fraud or other bad behavior involved.

Bad behavior might be something like cashing a Social Security check, then reporting it missing, then cashing the replacement check as well. An overpayment for something like that would not be waived.

If the overpayment amount is more than $2,000, you will need to make an official request for a waiver using Social Security’s Request for Waiver of Overpayment Recovery form (SSA-632-BK). Or you can contact Social Security call center at 1-800-772-1213, and they will complete the form on their end over the phone. However you do it, that form will include a lot of questions about your income, your assets, and your expenses, both for you personally and for other members of your family that you live with. Be sure to have this information ready before you start, especially if you choose to complete the form over the phone.

To file for the waiver, two things must be true:

1. First, the overpayment was not your fault. By asking for a waiver, you are saying that you did not do anything wrong to cause the overpayment. That usually means that you believe that you did everything that you were supposed to do on your end, but you ended up with an overpayment anyway. If the overpayment happened because Social Security found out about income that you did not report on time, or if you were in jail and continued to get checks that you were not supposed to get, then you are at least partially “at fault.” Social Security does not have to waive overpayments where you were part of the problem.
2. Second, you cannot afford to pay the money back. This is why they ask you about your income and your expenses. If you barely have enough money to pay for the things you really need, like rent, utilities, food, car payments, taxes, insurance, and the like, then Social Security can find that you would not be able to afford to make any regular payments on the debt you owe them. If they find it is a “hardship” to pay back the overpayment (and if you weren’t at fault for it), then and only then can Social Security waive it.

If you already receive any SSI or TANF, Social Security will usually find that you qualify for a hardship. You will still need to complete the full waiver request form if the overpayment was $2,000 or more.

If Social Security denies your waiver request, you can file an appeal to have a hearing before a judge. If you receive only SSI, not Social Security Disability or Retirement benefits, you may be required to file a Reconsideration of the waiver denial before you can take the case to a judge.

It is a good idea to save all the paperwork Social Security sends you about your waiver or any other correspondence you receive about an overpayment.

If you are out of appeal rights and your waiver was denied, then Social Security will try to collect on the overpayment just as if you had not appealed at all. You can still ask for the the $10 rate if you have Part D “Extra Help” through Medicare. You can also qualify for the $10 rate if you receive disability or pension benefits from the VA or if you receive TANF.

You can also ask Social Security to set up a payment plan that you can afford. Social Security uses a different form but with the same information about your income and your expenses as used on the waiver form. They will use this information to decide what they think is a fair amount that you can afford, while also looking to see if that amount is enough for you to fully pay off the overpayment.

Social Security gives you up to five years (60 months) to pay off an overpayment using a payment plan.

Under current rules, Social Security is supposed to accept payments of 10% of your monthly benefits even if that amount won’t pay off the full overpayment within five years.

• Social Security Administration call center: 800-772-1213
• Social Security Administration website
• File for Reconsideration online
• Social Security forms