What is an Overpayment?

Posted August 28, 2015 by Premier Disability Services, LLC® When the Social Security Administration (SSA) pays a claimant too much of a monthly benefit, or releases an excessive amount of retroactive benefits, this is referred to as an overpayment.  These overpayments often occur due to a miscalculation by SSA.  For example, in the case of an SSI recipient, a change in marital status or living situation that was not previously reported to SSA may lead to a miscalculation of benefits.  If SSA determines that a claimant received an overpayment, they will send a notice explaining the overpayment and requesting a full refund within 30 days.

An overpayment can cause a significant financial burden on claimants.  In most cases, claimants have been out of work for a significant time and the entirety of their benefits immediately goes toward costs for meeting daily needs.  If a claimant is unable to afford the requested overpayment refund, they have a few options.  First, if the overpayment is due to a mistake on the part of SSA, a claimant can request a waiver of the overpayment.  If the waiver is granted, the claimant will be released of their obligation to repay the funds.  Also, if the claimant does not agree with the determined reason for the overpayment, there is an appeal process for reviewing the overpayment amount and reasoning.  Finally, if the overpayment is valid, SSA may propose withholding a small portion of a claimant’s monthly benefits until the refund is complete.

The most important thing to remember in an overpayment situation is to take immediate action.  Many of the options detailed above have deadlines.  If you receive an overpayment notice, take time to thoroughly review the details and contact your local SSA office immediately to request a waiver if you feel the overpayment was due to an SSA oversight.

By: Devon Brady of Premier Disability Services, LLC®