If you or someone you know receives Social Security, there is something important you need to know. The Social Security Administration (SSA) has started reducing monthly payments for thousands of people. The reason? The agency is trying to recover money it says it overpaid to recipients in past years.
This change could come as a shock, especially if your benefits are your main source of income. Let us walk through what is happening and what options you may have if you are affected.
Why is social security reducing payments?
The SSA is now withholding 50 percent of monthly benefits for people who owe money due to past overpayments. That is a big jump from the 10 percent withholding policy used under the Biden administration.
The decision came after the agency was pressured to fix long-standing problems in how it handles overpayments. According to the SSA, an estimated $32.8 billion in overpayments were made between 2020 and 2023 in both Social Security retirement and disability programs.
How do overpayments happen?
Many people receiving Social Security have no idea they were overpaid until they get a letter saying they owe thousands of dollars. Overpayments can happen for many reasons, including:
- Reporting delays on income (like wages or pensions)
- Errors in calculating benefits
- Not reporting life changes like divorce, death of a spouse, or a child aging out
- Failing to notify SSA about other government benefits
Thomas Savidge, an economist at the American Institute for Economic Research, explained it this way:
“Social Security overpayments tend to occur from errors in reporting, such as a time lag that naturally comes from reporting income via W-2, incorrect benefit calculations, failure to offset other government pensions, or changes in family status.”
How much can the government take from your check?
Right now, the SSA is allowed to take up to 50 percent of your monthly check to repay the debt. That is a lot—especially for people who rely on these payments to cover basic needs like rent, groceries, or medicine.
Before this new rule, they could only take 10 percent, and at one point, there was even a plan to withhold 100 percent of monthly benefits. But after public backlash and media coverage, that plan was dropped.
Still, the current 50 percent policy is raising concerns. Ashley F. Morgan, a lawyer who handles these cases, said:
“Collecting 50 percent of someone’s Social Security benefits is very extreme. Most people on Social Security that has had an overpayment has no other income. Taking 50 percent of someone’s income leaves them without the means to survive.”
Who is most at risk of being affected?
The people most likely to be impacted by this policy include:
- Disabled individuals who return to work but do not report earnings
- Early retirees who work and earn above the yearly limit
- Survivors or dependents whose eligibility changed but was not updated
- People who received benefits during temporary income drops, but then got back on their feet
Morgan added:
“Too often people earn money and fail to report the earnings to the Social Security Administration, and the government only finds out after the overpayment has happened.”
What can you do if you are affected?
If you received a notice from the SSA about an overpayment or a benefit cut, you do have options:
- Request a lower withholding rate if 50 percent is too much for you to afford
- Apply for a waiver if the overpayment was not your fault and you cannot repay it
- File an appeal if you believe the SSA made a mistake
According to Savidge:
“For those who feel that 50 percent withholding is unjust or causes severe hardship, there is legal recourse. They can request a lower withholding rate, a waiver of recovery, and even appeal the overpayment decision.”
If you are worried about this, it is a good idea to contact Social Security directly or speak with a legal expert familiar with benefits. The earlier you act, the more options you may have.
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