What to Do When the SSA Sends You a Notification of Overpayment?

What to Do When the SSA Sends You a Notification of Overpayment Featured

An overpayment occurs when the Social Security Administration (SSA) pays out more money than you should have received. When this occurs, the SSA will send you a Notice of Overpayment, explaining why you were overpaid. The notice will detail the amount of overpayment and the proposed plan for repayment. It will also explain the overpayment amount, your repayment options, and the appeal and waiver options you have to fight the overpayment.

The SSA determines that an overpayment has occurred after they become aware of changes to your living situation, income, disability, resources, or other public disability information that they were not aware of at the time that benefits were paid. The SSA determines that there has been an overpayment after conducting period checks that review the beneficiary’s situation. These reviews include checking into state and federal databases for unreported income, death records, or incarceration records. As part of these reviews, the SSA may request additional information or documentation from beneficiaries. Beneficiaries are responsible for reporting the following changes: 

  • You apply for or begin to receive workers’ compensation or other public disability benefits.
  • You return to work.
  • You are confined to a jail, prison, or correctional facility (custody changes).
  • You become entitled to a pension, an annuity, or other lump sum payment based on your employment not covered by Social Security.
  • There is a change in your marital status.
  • You become a parent of a child.
  • Your disability improves.

Upon issuing a Notice of Overpayment, the Social Security Administration requests complete repayment within 30 days. If you’re receiving ongoing payments and fail to fully repay, the notice will:

  • Suggest deducting the overpayment from your benefits, either up to 10% or the total monthly amount, whichever is less;
  • Specify when this deduction is set to begin;
  • Clearly outline your rights to appeal;
  • Detail the process for requesting a review and potential waiver of the overpayment, potentially excusing you from repayment;
  • Provide information on how to formally contest the decision.

We will outline why this overpayment may occur and what you can do if you get a Notice of Overpayment.  

Why Do SSA Overpayments Occur?

The following are some of the common reasons why SSA overpayments occur: 

Data errors

In some cases, the Social Security Administration does not have an entire or accurate record of when they calculated and paid out benefits. This could be due to human error or technical glitches. 

Income changes

Overpayments occur when there is a change in the individual’s income that the SSA was not aware of when they calculated and paid out benefits. If you receive SSI (Supplemental Security Income), you are only allowed to have $2,000 as an individual or $3,000 if you are married. If your income changes and you exceed these levels, your benefit amount may change and an overpayment may occur. 

Return to work

If you receive Social Security Disability Insurance (SSDI) benefits and you return to work, you must report that change to the Social Security Administration. The SSA allows SSDI recipients a trial work period. You may test your ability to work for nine months, no matter how much you earn, and continue to be eligible for benefits. After the nine months of the trial work Period, the SSA will evaluate your work and earnings. If you work at substantial gainful activity levels, they may determine that you are no longer eligible for benefits due to work. The SSA will issue a Notice of Overpayment if you fail to report your work earnings or they do not assess your earnings in a timely manner. 

Disability improvement

If your condition improves, or the Social Security Administration believes that your condition will improve such that you can return to work, your benefits may end. For the months the SSA determined you were not disabled, an overpayment may occur. 

Delayed reporting and inaccurate benefit calculation

In many instances, the Social Security Administration issues a Notice of Overpayment if there is a delay in reporting or recording of changes in circumstances, such as marriage, divorce, or death. This is because the SSA might still be making payments based on outdated information. In other cases, they might miscalculate the amount of benefits an individual is eligible for.

Recently, the Social Security Administration has drawn scrutiny because in many cases, the overpayment issue was a result of delays caused by the government, rather than the beneficiary. By the time the SSA catches mistakes or updates their records, years can pass, and the amounts beneficiaries owe can inflate. 

The SSA Overpayment Notification Process

Here’s how the SSA determines overpayment and what you can expect if you receive a Notice of Overpayment: 

Identification of overpayment

The Social Security Administration conducts regular reviews of beneficiaries’ records. If they identify a discrepancy suggesting overpayment, they initiate the notification process. 

Overpayment notification process

When the Social Security Administration determines that you were overpaid, they will send out a Notice of Overpayment. In the notice, they will explain why you were overpaid, how much money you owe, and how you can make repayment. Sometimes there will be further explanations or tables of how the SSA arrived at the overpayment, but not always. In many cases, these notices can be vague or confusing.

If you agree that the overpayment occurred, you have options for repayment. If you are still eligible for and are receiving Social Security benefits, the SSA will withhold the full amount or part of your benefit amount each month until the money has been repaid.

If you do not agree that you’ve been overpaid or the amount is incorrect, you can file an appeal. 

Appeal and waiver rights

If the overpayment is not correct because you were not overpaid or the overpayment amount is incorrect, you may file an appeal. The appeal is called a Request for Reconsideration. This appeal can be filed online.

If you were overpaid but the overpayment was not your fault and you cannot afford to pay it back, you can request that the SSA waive the collection of the overpayment. This waiver is called the Waiver of Overpayment Recovery. This waiver should be filed by mail or fax, or in person.

After the appeal or waiver is filed, the SSA will stop the recovery of the overpayment until they make a decision. If there is still a dispute about the overpayment, a beneficiary can file to request a hearing with an administrative law judge. 

Time limit for responding to overpayment notice

You have 60 days from the date you received the overpayment notice to file an appeal. Meanwhile, there is no timeline to file the Waiver of Overpayment Recovery. 

What to Do After Receiving an SSA Overpayment Notice

If you receive a Notice of Overpayment, review the details carefully. You’ll need to be sure that the notice accurately explains why you were overpaid and the amount you were overpaid. Whether or not you agree with the decision, make sure to contact the SSA.

If you do not disagree with the Notice of Overpayment, an appeal or waiver should be filed within 60 days. If you do not respond within 60 days, the SSA will assume you agree with the decision and will start deducting the overpayment from your benefits.

You can also apply for a Waiver of Overpayment Recovery if repaying would cause financial hardship. This requires proving that the overpayment was not your fault and repaying it would cause financial distress. 

The SSA Under Investigation for Overpayment Issue

We understand that many people face uncertainty and worry when they receive a Notice of Overpayment. This overpayment issue has reached a crisis level. In fact, 60 Minutes recently released an investigation into this issue. The Social Security Administration overpaid beneficiaries a total of $21 billion nationally. In many cases, these overpayments occurred at no fault of the beneficiaries.

Congress has stepped in to investigate this crisis. In October 2023, a congressional hearing was held to determine the cause and solutions to the overpayment issue. The Social Security Administration has responded, and the SSA commissioner has ordered a top-to-bottom review of the agency’s overpayment procedures. 


There are many different reasons an overpayment may occur, including what type of benefit you are on. Common causes of an SSI overpayment are being over the resource limit, being over the income limit, and in-kind support being discovered and retroactively applied. Common causes of an SSDI overpayment may include a finding that you are no longer disabled, a return to work beyond the trial work period, or an incorrect calculation of benefits after a discovery that you received other public disability benefits.
You should file an appeal if the overpayment seems incorrect, you are not clear what caused the overpayment, or the SSA’s numbers seem wrong. If you know that the SSA correctly sent out the overpayment notice but you cannot afford to pay the money back, you should file a waiver. An appeal can be filed online here or by filling out and submitting form SSA-561 and faxing or mailing it to your local Social Security office. A waiver cannot be filed online. You can file the waiver by submitting form SSA-632 and faxing it or mailing it to your local Social Security office.
If an SSI recipient receives an overpayment, the SSA will withhold 10% of the benefit. If an SSDI recipient receives an overpayment, the SSA will automatically withhold their entire benefit. If you cannot afford to pay back the overpayment at that rate, you can request to lower the withholding amount by submitting form SSA-634 to your local Social Security office. If you need to pay back an overpayment and you are not receiving benefits, the Social Security Administration will send bills and eventually pursue other collection methods. During this overpayment collection, you can set up a payment plan with your local Social Security office.

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