A NEW bill is seeking to close a Social Security loophole as the government becomes more aggressive in seeking overpayments.
The agency has launched a full crackdown policy and is chasing up its cash – but this could change soon.
On March 14, Senators Ruben Gallego (D-AZ) and Bill Cassidy (R-LA) introduced a law that aims to protect seniors from Social Security overpayments being demanded back.
If someone is overpaid by the Social Security Administration (SSA), there is a good chance that is isn’t their fault.
There is a good chance it was a simple error made by the government, but the burden is being put on the taxpayer to give money back they were accidentally paid.
The Social Security Overpayment Relief Act seeks to prevent the SSA from taking back benefit overpayments due to errors made by the agency and not the individual.
This covers overpayments that are more than 10 years old specifically, as reported by Yahoo!.
Gallego said: “Seniors shouldn’t have to pay for the government’s mistakes, especially not mistakes that happened decades ago.”
He added that the bill would ensure seniors aren’t “blindsided by massive repayment amounts through no fault of their own.”
SOCIAL SECURITY CRACKDOWN
Under President Trump’s second administration, the SSA has gotten far more aggressive about demanding overpayments back.
On March 27, it returned to its 100% overpayment withholding policy.
This is a rule that allows the agency to keep your entire monthly benefit until reimbursement is complete.
Previously, the withholding rate was capped at 10% due to potential hardship of beneficiaries.
The SSA’s Office of the Inspector General said in 2024 that nearly $72 billion in improper Social Security payments were made between 2015 and 2022.
It was said that most of this was made up of overpayments, and actually account for less than 1% of the benefits paid over that seven-year period.
By the end of 2023, the SSA reported an uncollected payment balance of $23 billion.
Despite this, the policy switch is expected to increase overpayment recoveries by $7 billion over the next decade.
The Social Security Overpayment Relief Act would therefore reduce some of the agency’s powers to claim back mistaken overpayments from some of the most vulnerable people in the US.
HOW TO AVOID OVERPAYMENT
If you’re looking to avoid this headache completely, the best thing you can do is keep an eye on your Social Security account.
But if you still find yourself worried, there is help out there, like a financial adviser, for instance.
Someone like this could flag any problems on your behalf to the SSA, as well as give you a better understanding of the Social Security system.
WHEN SOCIAL SECURITY PAYMENTS ARE MADE
Social Security payments are issued on the second, third, or fourth Wednesday of each month based on the recipient's birth
Second Wednesday: For individuals born between the 1st and 10th of the month Third Wednesday: For those born between the 11th and 20th Fourth Wednesday: For those born between the 21st and 31stIt is important to note that if the agency reaches out to you via mail to alert you to an overpayments, you have 30 days to pay it back.
If you fail to do this, currently, the SSA will be able to begin its rigorous collection process.
You are also able to file an appeal with the SSA directly if you believe you have been overpaid.
The timeline for the Social Security Overpayment Relief Act is unknown, but more information about it could release in the coming weeks.
AlamyIf you’re looking to avoid this headache completely, the best thing you can do is keep an eye on your Social Security account[/caption] Read More Details
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