Recently, a reader asked: “Is it possible to waive an overpayment in disability benefits if I have good cause? If yes, how do I do that?” This is a great question! We’ll explain why some people get overpayment letters from the Social Security Administration and how to deal with them below.
The SSA administers payments for three different benefit programs each month, including:
- Retirement (i.e., regular Social Security payments)
- Disability Insurance, also known as SSDI
- Supplemental Security Income (SSI)
Anyone drawing these benefits can potentially receive an overpayment letter in the mail.
Why Would Anyone Need to Pay Back Their Disability Benefits?
Most people who get these letters have allegedly received more benefit money than the SSA should have paid them. Some common reasons why this might happen include:
- Failing to report changes in your marital status, living situation, health or income in a timely manner (or at all). For example: Since your disabled ex-husband gets SSDI, you also receive monthly spousal benefits. Three years later, you marry someone else but don’t tell the SSA for another four months. Now, you must repay those four months of SSDI benefits you received after you no longer qualified for them.
- You now have more income or resources than the maximum amount allowed to qualify for benefits. For example: You inherit some money from an aunt that passed away. After taxes, she leaves you with $5,600, which you deposit into your bank account. Because SSI rules say you can’t have more than $2,000 in assets, you no longer qualify for those benefits. You must now repay any SSI benefits you received after the date you deposited that inheritance money.
- Your health improved enough for you to start working again, so you’re no longer medically eligible for disability. Whether you’re working now or not is irrelevant to the SSA. If you receive disability benefits while you’re technically able to work, you still owe the overpayment amount that’s due.
- The SSA incorrectly calculated your benefit payments based on incomplete or inaccurate claim information. It doesn’t matter if you did this on purpose or by mistake, or whose fault it is that the calculations are wrong. Even if the overpayment is 100% the SSA’s fault, you must still pay the money back, regardless.
How to Request an Overpayment Waiver
If you get an overpayment letter in the mail but absolutely cannot repay the money, you can request a waiver. You must appeal within 10 days after your overpayment letter arrives to keep your benefit payments at the same amount. To appeal your overpayment, fill out Form SSA-561-U2, Request for Reconsideration and then mail it back to the SSA. (Your overpayment letter should list the address and date to mail in your written request for reconsideration.)
Once you do that, fill out Form SSA-632-BK, Request for Waiver of Overpayment Recovery. In order to get your overpayment waived for good cause, you must show that:
- You have good reason to believe the overpayment isn’t your fault, AND
- You cannot afford to pay the money back and cover necessary living expenses (i.e., rent, food, utilities), OR
- Giving back the overpayment money is unfair to you for some other reason.
If you don’t appeal or request an overpayment waiver within 30 days, the SSA starts automatically reducing your benefit payments. Typically, they’ll deduct up to 10% from your disability benefits each month to cover the cost of your overpayment. Once the SSA recovers the full overpayment amount owed, your benefits will go back up again the very next month.