Social Security Reinstates Full Overpayment Recovery Rate Nationwide

The Social Security Administration (SSA) will reinstate a policy that mandates a 100 percent withholding rate for beneficiaries who are found to have been overpaid starting March 27, 2025. This change aims to recover approximately $7 billion in overpayments over the next decade, a move that Acting Commissioner Lee Dudek states is essential for safeguarding taxpayer funds. Critics argue that this policy, previously capped at 10 percent under the Biden administration, could significantly harm older Americans already facing financial struggles, as sudden full recoveries may leave some without a monthly check. While the SSA is legally required to seek repayment, advocates have raised concerns about the potential for beneficiaries to be caught off-guard by large repayment demands, especially when errors originate from the agency. The SSA maintains that it strives to ensure accurate payments, and those unable to repay in full can request a lower rate or appeal the decision. This development has reignited discussions on the financial stability of the Social Security system amid broader concerns about its long-term viability.