A major policy shift by the Social Security Administration took effect today, allowing the agency to withhold 100% of a recipient’s monthly benefits to recover overpayments. The change is sparking concern among advocates who say it could push seniors into poverty.
What Changed?
Under the new rule, the SSA will withhold an entire Social Security check to recover any new overpayment identified after March 27, 2025. Previously, the agency capped withholdings at 10%, a limit that was put in place to reduce financial hardship for beneficiaries.
This rollback to full withholding will not impact recipients already repaying overpayments before the March 27 cutoff — they will remain at the 10% rate.
Who Will Be Hit the Hardest?
Advocates for seniors say the policy could devastate the most vulnerable recipients.
“It leaves beneficiaries with no money for basic needs like food,” said Dan Adcock of the National Committee to Preserve Social Security and Medicare. He noted that 40% of recipients rely on Social Security for 90% or more of their income.
Why the SSA Made the Change
The policy is part of a broader effort by the SSA and the Department of Government Efficiency (DOGE) — led by Elon Musk — to reduce federal spending. Interim SSA Commissioner Lee Dudek said the agency has a responsibility to be good stewards of taxpayer funds.
This includes recovering an estimated $7 billion in overpayments over the next decade. According to SSA data, nearly $72 billion in improper payments occurred from 2015 to 2022, and $23 billion in overpayments were still uncollected as of September 2023.
Many Overpayments Aren’t the Beneficiary’s Fault
A 2022 report from the SSA’s Office of Inspector General found many overpayments were due to agency errors, not fraud. Mistakes in benefit calculations and delays in updating income or status changes often led to overpayments.
Critics argue that seniors shouldn’t be punished for problems they didn’t cause — especially when the SSA is short-staffed and difficult to reach.
DOGE Cuts Are Making Things Worse
With thousands of employees laid off and SSA field offices closing, it’s becoming harder for recipients to get answers or fix issues. Only about 46% of calls to the SSA are answered, according to a recent Senate hearing.
Long wait times and frequent disconnections make it difficult for people to report changes or request help before overpayments occur.
Can You Avoid a Social Security Overpayment?
Yes — but it takes vigilance. To avoid overpayments:
- Update your information: Notify the SSA immediately of any change in income, marital status, or living arrangements.
- Watch your benefits: If your payment increases unexpectedly, call the SSA or check your account online.
- Keep documentation: Track your benefit statements and report anything unusual.
“Unfortunately, the onus is on us,” said CBS News analyst Jill Schlesinger.
What to Do If You’re Overpaid
If you receive an overpayment notice:
- Appeal the decision or the amount.
- Request a waiver using SSA Form 632 if it wasn’t your fault and repayment would cause hardship.
- Contact SSA immediately: You can ask for a reduced withholding rate.
The SSA says it will wait 30 days (plus five mail days) from the notice date before beginning collection. Repayment options include credit card, check, or online bill pay.
Failure to act can lead to more severe consequences, including garnished wages, tax refund seizure, or damage to your credit score.
What About SSI Recipients?
Supplemental Security Income (SSI) beneficiaries are exempt from the 100% clawback. Their withholding rate for overpayments will remain at 10%.
Looking Ahead
Incoming SSA commissioner nominee Frank Bisignano has pledged to reduce improper payments — both over- and underpayments — and to rebuild the agency’s capacity. But experts say that improving accuracy and access to services will require significant investment.
For now, seniors and other Social Security recipients are urged to monitor their payments closely and take quick action if anything seems off.
“Overpayments should be recouped,” said Shannon Benton of The Senior Citizens League, “but beneficiaries need time to plan — not sudden, 100% reductions.”
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