Social Security Reverses Plan to Withhold 100% of Benefits to Recoup Overpayments
As of April 25, the SSA will no longer require beneficiaries who have been accidentally overpaid to have 100% of their monthly benefit check withheld until the balance is paid, reversing an earlier decision.
The Social Security Administration is walking back its policy that would have required beneficiaries who had been accidentally overpaid to have 100% of their monthly benefit check withheld to pay down the balance. The change comes less than two months after the agency announced it would reinstate a longstanding policy of withholding 100% of benefit checks until the balance is paid off.
In an “emergency message” dated April 25, the Social Security Administration set a withholding rate of 50% of each monthly benefit check to recoup money from beneficiaries who were paid more than they were eligible to receive.
Generally, beneficiaries are responsible for reporting changes that could affect their eligibility or payments, such as a change in income. According to the SSA, incorrect or incomplete information from this self-reporting is a leading cause of payment errors, but some do arise from mistakes by the agency.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
“Improper payments have been a longstanding challenge for SSA. While the Agency has taken actions to address this challenge, it needs to do more, and OIG’s recommendations can guide the Agency as it determines those corrective actions,” said Michelle L. Anderson, Assistant Inspector General for Audit and Acting Inspector General. “Without better access to data, increased automation, systems modernization, and policy or legislative changes, improper payments will continue to be a major challenge for SSA into the future.”
In a July 2024 report, the SSA’s Office of the Inspector General said there were about $71.8 billion in benefits — less than 1% of the $8.6 trillion paid out — in improper payments between fiscal years 2015 and 2022. While not all of these were overpayments, most fell into that category. In another report, the Office of Inspector General (OIG) said overpayments in the Old Age, Survivors, and Disability Insurance program added up to roughly $13.5 billion in the four years from 2020 until 2023.
“We have the significant responsibility to be good stewards of the trust funds for the American people,” said Lee Dudek, Acting Commissioner of Social Security. “It is our duty to revise the overpayment repayment policy back to full withholding, as it was during the Obama administration and first Trump administration, to properly safeguard taxpayer funds.”
The agency is required by law to try to reclaim any overpayments as they occur.
90-day grace period to appeal SSA’s claim
The 50% withholding applies to overpayments of retirement, family and survivor benefits, and Social Security Disability Insurance (SSDI). Most prior overpayments will remain subject to the 10% cap, established in March 2024, as will any overpayments of Supplemental Security Income (SSI).
The April 25 message from the SSA’s Office of Legal Policy and Office of Income Security Programs states that “language about the 10% withholding rate will be updated to 50% in outgoing overpayment notices.”
Beneficiaries who receive will have 90 days to appeal the agency’s claim that they were overpaid. They can also request a waiver of repayment, or a repayment rate below 50% for reasons of financial need. If no claim is made, withholding will begin after 90 days. The SSA has a fact sheet with more information on appeal and repayment options.
Requiring 100% repayment is not new
Opting to withhold 100% of benefits to reclaim what the agency has identified as overpayments isn’t new to the second Trump administration. The policy was also in place during the Obama administration and the first Trump administration. The reduced withholding rate of 10% was put into place in 2024 during the Biden administration because the 100% rate proved too difficult for some beneficiaries to pay. The announcement that the SSA will now withhold 50% of the monthly benefits should be a welcome reprieve for many.
For more information about overpayments and appeal rights, visit www.ssa.gov.
Related Content
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

For the past 18+ years, Kathryn has highlighted the humanity in personal finance by shaping stories that identify the opportunities and obstacles in managing a person's finances. All the same, she’ll jump on other equally important topics if needed. Kathryn graduated with a degree in Journalism and lives in Duluth, Minnesota. She joined Kiplinger in 2023 as a contributor.
-
The Social Security Test Every Wealthy Retiree Must TakeWhen you work and collect Social Security benefits before your FRA, you are subject to the Retirement Earning Test that could result in a temporary reduction of your benefits.
-
I'm a Government Employee and Need to Get By Until the Shutdown Ends. What Can I Do?The second-longest shutdown in history is leaving many federal workers with bills due and no paycheck to cover them. Here's what you can do to get by.
-
The Social Security Earnings Test: Know This Rule Before Working in RetirementWhen you work and collect Social Security benefits before your FRA, you are subject to the Retirement Earning Test that could result in a temporary reduction of your benefits.
-
Grant Cardone Tells Us the Biggest Retirement Mistake You Can MakeThe entrepreneur, real estate investor and motivational speaker tells us why people should never stop working.
-
Five Estate Planning Pitfalls and How to Avoid ThemFrom procrastination to AI, these five estate planning pitfalls could mean your heirs are left with bureaucratic hassles — or a reduced inheritance.
-
I'm a CPA: Control These Three Levers to Keep Your Retirement on TrackThink of investing in terms of time, savings and risk. By carefully monitoring all three, you'll keep your retirement plans heading in the right direction.
-
CMS Brings Back Furloughed Staff for Medicare Open Enrollment LifelineThe government has recalled approximately 3,000 workers to assist with Medicare and ACA Marketplace Open Enrollment.
-
Quiz: How Well Do You Understand the Social Security Earnings Test?Quiz Test your basic knowledge of the Social Security earnings test in our quick quiz.
-
The 'Go Live Your Life' Rule of Retirement SpendingThe 'guardrails approach' to retirement spending signals when you can spend more and when you need to rein it in, giving you greater flexibility in your post-work life.
-
I Retired at 65 With $7.8 Million and Feel Like I Over-Saved. My 40-Something Son Is on the Same Path. Should I Tell Him to Reconsider?We ask financial experts for advice.