Social Security to start withholding half of benefits for millions – this is the start date?

The Social Security Administration (SSA) is set to cut monthly benefit checks in half for some recipients starting in August. This change will impact millions of beneficiaries as the SSA works to recover overpayments made in previous years. If you’ve received a notice of overpayment, it’s important to understand what this means for you and what steps you can take to address it.

Overpayments can happen for several reasons, such as mistakes made by the SSA or failure to report changes in income or living situations. According to a report from the Office of the Inspector General, the SSA made an estimated $72 billion in improper payments between 2015 and 2022, the majority of which were overpayments.

Starting in August, the SSA will withhold 50% of monthly benefits from individuals with outstanding overpayment balances. Notices of overpayment were sent to affected individuals at the end of April. If you’ve received one, here’s what you need to know.

How does the Social Security Administration recover overpayments?

Overpayments are typically the result of administrative errors or changes in beneficiaries’ circumstances. In March, the SSA announced that it would start recovering overpayments at a rate of 100% of monthly benefits. However, following widespread criticism, the agency revised its policy in April, capping the withholding rate at 50%.

What does this mean for you? If you’ve been notified of an overpayment, you may be facing a 50% reduction in your Social Security payments until the balance is cleared.

What can you do if you’ve received an overpayment notice?

Once you receive an overpayment notice, you’ll have a 90-day window to act. You have a few options:

1. Request a waiver of repayment: If you believe you were not overpaid or if withholding 50% of your benefit would cause significant financial hardship, you can apply for a waiver.
2. Negotiate a lower withholding rate: In some cases, you may be able to agree on a lower rate of withholding.
3. Take no action: If you do nothing, the SSA will begin withholding 50% of your monthly benefit starting in August.

When will the cuts begin?

The first benefit payment for August will be made on Wednesday, August 13th. However, for many, the first round of reduced payments will likely occur with benefits due on that date. Here are the payment dates for August:

If you’ve been notified of an overpayment, it’s crucial to act within the 90-day window to avoid having your benefits reduced by 50%. Review your options carefully and take the necessary steps to protect your financial well-being. If you need help, don’t hesitate to reach out to the SSA for guidance on your specific situation. Have questions about how the process works? Don’t delay – the clock is ticking.