Social Security Withholds 50% Benefits to Recover Billions in Overpayments

Starting in late July 2025, some Americans receiving Social Security benefits will see their monthly payments reduced by 50% as the Social Security Administration (SSA) moves to recover billions in past overpayments. This new withholding rate applies to beneficiaries notified of overpayments on or after April 25 and is a partial retreat from an earlier plan to withhold 100% of benefits until repayment. Overpayments can result from unreported income changes, agency errors, or other factors, with $72 billion in improper payments made between 2015 and 2022 and $23 billion still uncollected as of 2023. The SSA previously limited withholding to 10% of benefits following public criticism over harsh collection practices that caused financial hardship for some recipients. Additionally, starting September 30, all Social Security payments must be made electronically, ending paper checks for nearly 500,000 recipients. These changes come amid broader Social Security adjustments, including benefit increases under the Social Security Fairness Act.