According to The Sun , Concerns are mounting among Social Security recipients over the possibility of unknowingly being overpaid by the government. The Social Security Administration (SSA) has come under increasing scrutiny for its handling of overpayments, with experts warning that there is an internal push to recover these funds. Such repayment requests can significantly impact vulnerable individuals and families, as they may be asked to return money that has already been spent, leading to a bureaucratic nightmare for many.
Matthew Allen, a Social Security advisor, explains that when individuals receive notification of overpayment, they often enter into a repayment plan without exploring other options. However, he emphasizes that recipients have alternatives to simply paying back the overpaid amount.
Reasons for Overpayments
Social Security overpayments can arise from various factors, including agency errors, beneficiary fraud, or failure to accurately report earned income. An August report from the SSA’s Inspector General revealed that nearly $72 billion in improper payments were made between 2015 and 2022, averaging about $9 billion annually. Acting Commissioner Kilolo Kijakazi testified in October that the SSA issues approximately one million overpayment notices each year.
Options for Recipients
Allen suggests that recipients notified of an overpayment can pursue a waiver or a reconsideration of the claim. A waiver allows individuals to acknowledge the SSA’s claim while explaining their inability to repay the amount. In contrast, a request for reconsideration disputes the SSA’s claim. Allen notes that some individuals may qualify for a complete waiver of their overpayment, and even those with partial responsibility might see their debts reduced.
He urges recipients to be aware that they have the potential to settle their debts rather than automatically entering repayment plans. For balances under $20,000, the SSA may accept an offer in compromise. In cases of smaller overpayments, there may be a process for waiving repayment altogether.
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Agency Criticism
The situation has drawn criticism from former SSA employees and experts who claim that the system is fundamentally flawed. Avram Sacks, a former SSA employee, stated that overpayments, which amount to $9 billion a year, have reached unprecedented levels, affecting those with limited financial resources. He highlighted systemic issues within the agency, suggesting that beneficiaries are often treated like criminals despite many overpayments stemming from administrative errors.
Economist Larry Kotlikoff echoed these sentiments, condemning the SSA’s aggressive recovery efforts, which he argues disproportionately harm the most vulnerable citizens. He criticized the agency for exacerbating the financial struggles of those who rely on disability payments, stating that clawbacks could potentially lead to homelessness.
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