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1 1 (April 12, 2024)

handle is hein.crs/goveoyj0001 and id is 1 raw text is: Congressional Research Se~ Info~min~zi th~ Iegi~htive debate s~nee 1914 ice April 12, 2024 Social Security Overpayments: Debt Recovery Introduc on The Old-Age, Survivors and Disability Insurance (OASDI) program, commonly known as Social Security, is authorized under Title II of the Social Security Act (42 U.S.C. §§401 et seq.). Social Security is a work-based social insurance program that provides monthly cash benefits to retired or disabled workers and their family members, as well as to the family members of deceased workers. Benefits are derived from a worker's career- average earnings in covered employment. The program is administered by the Social Security Administration (SSA) and pays about $119 billion in monthly benefits to over 67 million beneficiaries each month (see SSA, Monthly Statistical Snapshot, February 2024, Table 2). A Social Security overpayment occurs when the SSA pays a Social Security beneficiary more than the agency should have paid (i.e., more than the beneficiary was entitled to receive). Of the approximately $1.3 trillion paid to OASDI beneficiaries in FY2022, SSA estimated that $6.5 billion (or 0.5%) were overpayments (see SSA, Annual Financial Report, Fiscal Year 2023, p. 177). Social Security overpayments can occur for a variety of reasons stemming from actions on the part of either the beneficiary or the agency. Major causes of OASDI overpayments are changes in marital status and child relationships, increases in beneficiaries' earnings, and SSA's computation errors (see SSA, Annual Financial Report, Fiscal Year 2023, p. 178). For example, an overpayment can occur if a beneficiary fails to timely notify SSA of a change in marital status or an increase in current earnings. An overpayment can also occur if SSA miscalculates the amount of benefits a beneficiary is entitled to receive. The recovery of Social Security overpayments is authorized under Section 204 of the Social Security Act (see 42 U.S.C. §404). SSA recovered $3.1 billion in OASDI overpayments during FY2023 and had $4.5 billion in OASDI overpayments scheduled for repayment at the end of FY2023 (see SSA, Agency Annual Overpayment Waivers Report, FY2023). This In Focus describes the debt recovery requirements for OASDI overpayments, as well as the recent changes in SSA's overpayment recovery policy. Overpayment Recovery Once SSA has determined that an overpayment has been made, the overpayment becomes a debt owed to the federal government. The agency notifies the liable beneficiary immediately by mail if the address is available (see SSA, Overpayments Fact Sheet). The liable beneficiary may be the beneficiary who has been overpaid, an individual who received Social Security benefits based on the same earnings record as the overpaid beneficiary (e.g., a dependent family member), or a representative payee who has received a payment on behalf of the overpaid beneficiary under certain conditions. Overpayment notices explain why the individual has been overpaid, the overpayment amount, repayment options, and appeal and waiver rights (see 20 C.F.R. §404.502a). Appea and Waiver Rights Overpaid beneficiaries (or their representatives) may appeal determinations by requesting reconsideration when they dispute the facts or amounts of overpayments. An individual generally has to request reconsideration within 60 days of the date the individual received the overpayment notice. Overpaid individuals may also request that SSA waive recovery of the overpayments if they believe they should not have to pay the money back. SSA does not impose a time limit for filing a waiver. Under current law, SSA will waive recovery of an OASDI overpayment if the overpaid individual is withoutfault in causing the overpayment and the recovery would (1) defeat the purpose of the OASDI program or (2) be against equity and good conscience (see 42 U.S.C. §404(b)). Withoutfault means that facts show that the individual did not cause the overpayment (see 20 C.F.R. §404.507). Recovery of an OASDI overpayment defeats the purpose of the program if recovery would deprive the overpaid individual of the income and resources required for ordinary and necessary living expenses (see 20 C.F.R. §404.508). Recovery of an overpayment would be against equity and good conscience for either of two reasons (see 20 C.F.R. §404.509): * The overpaid individual relinquished a valuable right or put himself or herself in a worse financial position because of the receipt of Social Security overpayments. For example, an individual purchased a more expensive home in light of the awarded amount of the Social Security benefit but was unable to afford the home after the discovery of a Social Security overpayment. * The individual was receiving benefits on the same earnings record as the overpaid beneficiary, was living in a separate household from the overpaid beneficiary at the time of the overpayment, and did not receive the overpayment. Internal Colections If the overpaid individual does not request reconsideration, request a waiver, or repay in full, SSA usually recovers the overpayment through one of several options.

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