Jessica Melton, a disabled East Tennessee woman, had no idea that a simple Social Security recertification would turn her world into a bureaucratic hell. A decade of receiving Supplemental Security Income (SSI) benefits after undergoing her 2009 open-heart surgery, Melton was informed that the Social Security Administration asserted she overpaid them $12,000—cutting her monthly payment down to $14.
The 17-year veteran of heart surgery, who was fitted with a mechanical valve and is no longer able to work because of her illness, found herself caught in a system that seems to have the purpose of punishing, rather than protecting, vulnerable Americans. Though her husband Jason’s income remained below the $3,000 a month limit for married couples on SSI, the agency concluded she’d received too much money for years.
When the system sends mixed messages
What is so troubling about Melton’s situation is the conflicting information that she received from the Social Security Administration. In January 2025, she was first informed by a Social Security agent that the $12,000 overpayment was not her error. Two weeks later, however, she was sent a letter informing her that she was at fault for the overpayment.
“They said they would check on my case every two years. It’s been fine until 2021,” Melton said. “My husband makes too much money”. Her husband Jason, who works as a delivery truck driver and ceased being self-employed to work full-time in the past 18 months, claims his paychecks consistently range from around $2,800—a considerable distance from the $3,000 cutoff point for married couples who are eligible for SSI.
The crushing effect on day-to-day life
The monetary impact of this finding of overpayment has been harsh. Melton’s SSI payments were progressively cut each month when the agency tried to recover what it suspected was an overpayment. “It was cut even one month to just $14. Each time I received a paycheck, I had to pay on an overpayment. Each time my husband received a paycheck, my overpayment was increased,” she explained.
This sharp decrease in benefits has put the couple in financial distress. “There’s a lot of red tape,” said Jason Melton, describing the bureaucratic nightmare faced by most Social Security recipients when confronted with overpayment problems.
Reaching the bottom of the wider overpayment crisis
Melton’s case is that of an ever-rising crisis for millions of Americans. The Social Security Administration has increasingly depended upon ever more extreme overpayment recovery strategies, and recent reforms permitted the agency to withhold as much as 50% of monthly benefits for so-called overpayments.
The numbers tell the story
The magnitude of the overpayment problem is staggering:
- Up to 1 million Americans receive overpayment notices from the SSA each year
- The SSA issued almost $72 billion of improper payments between 2015 and 2022
- The agency had $23 billion in outstanding overpayments as of September 2023
- Nearly 2 million Americans are now under overpayment recovery action
How SSI income limits cause confusion
The complication of SSI income rules is the source of most overpayment cases. The monthly income limit for couples married together is $3,000, yet the calculation is made using advanced formulas that also include spousal income based on a scheme called “deeming”. What this means is that even if a spouse’s income is theoretically low, a number of factors may push household income above the allowed amount.
The SSI formula also makes the recipient’s eligibility depend on how much of the spouse’s income is included. Spousal income is not one-size-fits-all—some kinds of unearned income are excluded, and earned income typically counts around 50%.
The changing policy landscape
The Social Security Administration’s approach to overpayment recovery has changed dramatically over the past few years:
Biden Administration (2024)
- Lowered rate of overpayment recovery from 100% to 10% of a monthly benefit
- Prolonged payment terms to 60 months
- Intended to alleviate fiscal burden on beneficiaries
Trump Administration (2025)
- Originally promulgated restoration to 100% withholding rate in March 2025
- Confronted strong opposition from advocates and seniors
- Reached determination on 50% withholding rate by April 2025
From July 2025, the SSA started withholding the 50% rate on fresh cases of overpayment, i.e., 50% of the monthly benefits of the affected claimants will be withheld until the debt is cleared.
Rights and options for affected beneficiaries
Despite the overwhelming nature of overpayment notices, beneficiaries have several options:
Appeal process
Recipients can request a reconsideration within 60 days of receiving an overpayment notice. However, filing within 30 days prevents the SSA from beginning recovery efforts during the review process.
Waiver requests
Beneficiaries can request a waiver if they believe:
- The overpayment was not their fault
- They cannot afford to repay the amount
- Repayment would cause financial hardship
Payment arrangements
Those who acknowledge the debt but cannot pay immediately can request reduced payment plans, potentially as low as $10 per month.
