Millions of Americans receive Social Security payments every year. However, a small percentage of them is overpaid. When the Administration finds out, you will have to face recovery. Do not forget that as of April 2025, the Agency announced the reinstatement of the overpayment recovery rate. Since SSA will increase the default overpayment withholding rate for Social Security to 50%, some recipients facing this situation may not be able to afford it.
Undoubtedly, this increase will result in a boost in the overpayment recoveries, for example, program savings. An estimate from the Office of the Chief Actuary claims this increase could be about $7 billion in just one decade. This is important because it will help protect the trust funds for all Social Security payments in the United States. Remember that the Agency is required by U.S. law to seek repayment.
If you can’t afford the full recovery of a Social Security overpayment
Social Security reminds people who are facing an overpayment and who cannot afford it to contact the Administration. All you have to do is call the SSA at 1-800-772-1213.
Once you call, inform the SSA of your financial situation and provide them with the reasons why you cannot afford to pay the full recovery of your overpayment in the U.S.
Another possibility, if you do not have the opportunity to call the SSA or you simply are not willing to do it that way, you can simply visit your local office. Remember to check opening hours and make an appointment if you do not want to stand in line.
Whether you call the Social Security Administration or visit a local office, you can simply request a lower rate of recovery. Undoubtedly, you could appeal the overpayment.
Appeal a Social Security overpayment
Do not forget that if you are not happy with a Social Security decision regarding an overpayment, you could appeal. First of all, you can appeal an overpayment decision.
Secondly, you can also appeal the amount. It will depend on your situation whether you need to appeal one option or the other one. Anyway, it is always possible to as Social Security to waive the collection of the overpayment.
Of course, this will be possible if you believe it was not your fault or if you can’t really afford to pay this money back to the SSA. What is more, the Administration does not pursue recoveries while an initial appeal or waiver is pending.
Note that the withholding rate change applies to new overpayments. Thus, the withholding rate for current beneficiaries with an overpayment before March 27 does not change. SSI recipients have the withholding rate for overpayments at 10%. Make sure you report any changes to avoid unpleasant overpayments in the U.S.
