There are millions of retirees who rely on Social Security as their main source of income. So, if someone receive a huge bill from the government stating that the owe thousands of dollars, this can be extremely stressful. Unfortunately for recipients, a recent change now gives the Social Security Administration (SSA) more power to demand a repayment if they believe that you were overpaid.
It’s important to note that the SSA can potentially take as much as half of your monthly check until the overpayment has been repaid. On the bright side, you have 90 days to respond, and it is important to know your options.
Why Are Retirees Getting Surprise Bills?
Firstly, let’s understand how Social Security payments are calculated. It is based on your work history, age as well as your income. Mistakes can happen while calculating your Social Security benefits and this is how overpayments occur.
As soon as the SSA identifies an error, they claim you have been overpaid. Once this happens, they send out a notice requesting you to pay back the money. If you ignore this or don’t take action, they will start deduction money from your benefit checks.
The 90-Day Response Window
Don’t panic just yet! The SSA gives you 90 days to respond to the notice before they start deducting money, you may:
- Appeal if you think the SSA is wrong.
- Ask for a waiver if you can prove that paying will cause you financial hardship.
- Request a payment plan
If you ignore the notice and do nothing, the SSA will begin cutting your monthly benefits automatically.
Who Is Most Likely to Be Affected
Not everyone will face this problem, but certain groups are at higher risk:
- Those retirees working part-time: If you earn more than the income limit before full retirement age, you may accidentally get overpaid.
- Disability recipients: Reviews of medical eligibility sometimes result in benefit reductions or repayment demands.
- Survivors receiving benefits: Mistakes in processing widows’ or dependents’ benefits can also be a contributing factor.
What To Do If You Get a Notice
Getting one of these letters can be scary, but you have options. Here’s what to do right away:
- Be sure to read the notice carefully – It will explain why they believe you owe money.
- Gather all the relevant documents – Tax documents, pay slips, or medical paperwork
- File an appeal or waiver – This stops automatic cuts until your case is reviewed.
- Contact the SSA – If you are unsure, speak to a consultant for further information.
- Seek assistance – Consult with a financial advisor if needed.
Can You Stop Them From Taking Half Your Check?
The short answer is that you can. However, you need to file the appeal as soon as possible so that the SSA will halt the collection and review your case. Should you request a waiver, they may reconsider provided that you prove the repayment will cause financial difficulties. You can also work out a smaller monthly payment by requesting a payment plan.
Why This Is Happening
Sadly, errors are bound to happen as the program serves millions of citizens. It is rather unfortunate that the impact falls on retirees who are already struggling. Even though officials are pushing for the SSA to better its processes, it is important for individuals to safeguard themselves.
Final Thoughts
The most important thing to remember, is never ignore the overpayment notification from the SSA. If you receive a notice, make sure you act within 90 days to safeguard your benefits.
Understand what you owe, do not panic and take action.