The Best Way To Fix A Social Security Overpayment Letter

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Social Security Overpayment letters are becoming more common.

For those who depend on Social Security payments, receiving a Notice of Overpayment is no fun.  These notification letters will often show up after a change in income or family status and generally allege that the Social Security Administration has paid you too much money.  In this letter they offer you a 30 day window to repay the benefits.

This leaves many shaken who count on this income to buy their groceries or some other necessity.   Fortunately, the Administration is often incorrect in their calculations.

However, there is still a process to follow if you receive one of these letters.  Unless otherwise stated, you have three options.

  • Pay the overpayment within 30 days
  • Appeal their determination within 60 days
  • Request a waiver

The option you choose depends on your circumstances.  Personally, I’ve seen too many bad calculations by the Social Security Administration to ever recommend just repaying the amount requested.  In my opinion, an appeal should always be the first step.

The Appeal

The first part of the appeal is to forget about the 60 day window.  You should file your appeal within 30 days.  Why?  For those requesting an appeal within 30 days, the overpayment will not have to be recovered until after the case is reviewed.  If you wait the full 60 days, it’s likely the Social Security overpayment recovery process will have already started.  This means that the Social Security benefit will be reduced, or worse, eliminated until the overpayment is collected.

The foundation of a great appeal is to understand why the Social Security Administration believes they overpaid you.  Sadly, it’s not always clear in their letters.  Gaining clarity on the reason behind the alleged overpayment will often take several phone calls or visits to the local Social Security office.  In my experience, I’ve found the Social Security technicians to be a mixed bag.  Some know very little about the program but some have forgotten more than I’ll ever know.    The point is, if you don’t get a clear answer on your first visit, go again!  Eventually, someone will be able to explain it in language that is understandable.

Once you have a clear understanding of the reason behind the overpayment allegation, it’s time to write your letter.  Accompanying this letter should always be the Social Security’s Social Security’s Request for Reconsideration Form 561 form (Form 561) and a copy of the letter you received from the Administration.

If you tell them why they are wrong about your Social Security overpayment, be prepared to back it up with references to their POMS Manual and other rules on the Social Security website.  This part may be complicated.  It’ll probably be worth your time to find an attorney or hourly financial planner who is knowledgeable about Social Security.

See my article about finding a Social Security Expert

Once you’ve sent your letter in, expect to wait for at least 4 weeks to receive a response.  In this response they will either:

  1. Agree with your appeal
  2. Request more information
  3. Disagree with your appeal

If they disagree with your appeal, and you still think you are right, it may be time to escalate the issue.  For this, I strongly suggest you find an attorney who can help.  Read more about this escalation process on the Social Security’s website section dealing with requesting a hearing.

If they disagree with your appeal and now you’re pretty sure that you were overpaid, you still have a few options.

Request a Waiver

The first option should probably be to request a waiver from the Social Security Administration.    This would waive or simply “write off” the overpayment.  To have a waiver approved, you must meet two conditions.

First, you have to convince SSA that the overpayment was not your fault. That would be easy to do in a situation where the government miscalculated your benefit.  That’s obviously Administration’s fault, not yours. But if you were overpaid because you failed to report some event that should have changed your benefit amount or even altered your basic eligibility for benefits, then you’ll have a hard time claiming it’s not your fault.

Even if the Social Security overpayment was not your fault, you must also prove to SSA that repaying the debt would create a financial hardship for you and your family. To do this, you have to provide SSA with records of your income and your expenses. This could include wage statements or tax returns and rent receipts, mortgage statements, utility bills, grocery receipts, etc. A Social Security representative will review your household budget and decide if the overpayment waiver can be granted.

If the Social Security Administration ultimately declines your request for waiver, the only option remaining is to pay the money back.  However, you do not have to pay it all back at once.  You can ask them to withhold a certain amount from your monthly Social Security checks until the overpayment is recovered.  If you do nothing, they’ll simply stop your check until the balance is recovered.

The key points to remember are:

  • Sometimes the Social Security Administration is wrong. Challenge them!
  • Expect the appeal process to take several weeks.
  • File your appeal within 30 days.
  • Don’t be embarrassed to request a waiver.
  • If you must pay it back, set up your own payment terms.

Have you ever had an experience with a Social Security overpayment letter?

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Lex McGuireDonna DillonGale MorrisGerardoTrenessa Recent comment authors
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Lex McGuire
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Lex McGuire

Social security changed the rules of when you receive benefits – from the month before to the month following your retirement. Without notice they stopped my direct deposit of benefits for two months. During those to months my family was in panic and hungry mode and I was contemplating suicide. Working on the computer and phone every day I only accomplished in getting 2 lies from social security 1. that there was an address mistake and 2. that that there was an address mistake. Then finally I received a letter on January 29th 2019 (60 days after stopping my direct… Read more »

Donna Dillon
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Donna Dillon

I’ve been fighting this for two years !! There system says I was overpaid ‘ NEVER was ! When I’d sent in a waiver back in 2017 on a hardship they paid me and said it was a overpayment! Was NOT I hv auto deposit nothing ever changed SO I hv to pay money back I don’t owe !! There unbelievable and don’t care!! I filled out paperwork said they never got it ! WOW it’s been crazy horrible !!! So I hv to pay back money I do NOT owe!!!

Gale Morris
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Gale Morris

It all started in 2011 and now notified in 2018.

Gale Morris
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Gale Morris

My husband receives a “State Pension” When he applied for SS he checked the wrong box and stated that he did not receive a pension. This was not intentional. Now we owe approx. $59000 back payments What will they do to us. He just thought he would be entitled and never read the paperwork verifying his answers. He was just naïve. We would never do anything illegal. Please help

Gerardo
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Gerardo

I’m going through the process now. I was over paid due to me starting to work. I had no choice. I have kids and we cannot live off $800. So I started working at minimum wage. I went in to the social security office and told them I was working and if they can stop my checks. They told me they would note that I came in for that reason and said to fill out some forms and mail them in. Obviously I didn’t turn them in. I then called the office months later and they said they would again… Read more »

Trenessa
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Trenessa

I applied for a waiver. I stated that I paid my fair share and the person I was living with also wrote a verification letter to show proof that I paid it. I didnt have the correct information and somethings were not reported about my living situation before the overpayment was issued.

issac scales
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issac scales

i got a letter from social security saying i was over paid benifits which no fault of mine . i had a payee at the time and i was in prison so how could i be at fault. i been trying over and over to contect the office by phone no luck and to ask for a waiver how can i set appointment ‘and get a waiver

Tami
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Tami

I am terrified since moving to a new town I got the notification letter. I appealed imminently but was denied now have to request a Judge review. I cannot believe they are doing this to me I was recently assaulted I care for my Daughter who is Down Syndrome & we are forced to live below the poverty line, yet they are after the little money we have!

Cheri
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Cheri

I am so worried. I got two letters. One for my ssdi and one as my minor kids Payee. It said we were both overpaid. I went in with the waiver and appeal forms. Gave them to lady at the ss office within days of getting them. I just got my kids check and it was cut in half. They took my total check. I never even got a response from them. What do I do? This is my only means of income.

Gem
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Gem

I had to appeal to have resource for my family and I to make ends meet. I was in and out of the hospital while recovering after transplant and was told from social security that I may have to repay it back. I had to appeal as it was the only income I had. I have no set of income at this moment. I get sick now and then. I was recently sick and recovering from it. What is the chance of social security waiving overpayment?

Lisa G
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Lisa G

Yes I have submitted RFR forms & have not heard back more than once. I sent one in June & still havent gotten a response, so frustrating.