Social Security Reduces Overpayment Clawback Rate to 50%

The Social Security Administration (SSA) has reversed its recent decision to claw back 100% of monthly benefit payments from recipients who were overpaid, reducing the default withholding rate to 50% following public outcry and concerns about financial hardship among beneficiaries. This change, effective for new overpayment notices from late April 2025, aims to ease the burden for retirees, disabled individuals, and other recipients who rely on Social Security for basic needs, though advocates warn that losing half of one's benefit can still be devastating. The rollback comes amid broader SSA reforms, including the implementation of the Social Security Fairness Act, which eliminates the Windfall Elimination Provision and Government Pension Offset, granting millions of public servants higher and retroactive benefits. The SSA is also undergoing administrative restructuring under the Department of Government Efficiency (DOGE), led by Elon Musk, with a focus on AI-driven fraud prevention and cost-cutting—measures that have sparked concerns about accessibility for vulnerable populations. These moves are part of the agency's efforts to rebuild public trust and improve administrative fairness after years of overpayment errors, many of which were due to the SSA’s own calculation mistakes. Beneficiaries who receive overpayment notices have 90 days to request a lower withholding rate, reconsideration, or a waiver, or else the new 50% withholding applies until the debt is repaid.