Posted on 07/01/2025 1:00:00 PM PDT by Red Badger
The Social Security Administration is clawing back more in overpayments than it has in the past thanks to a new rule.
Up to two million Americans could see their Social Security payments reduced by 50% in late July. The reduced payments are being implemented so that the Social Security Administration (SSA) can claw back billions in funds that it overpaid to some Americans over the past several years.
Here’s what to know about the reduced Social Security payments and who could be affected.
What’s happened?
In April, the Social Security Administration announced that it would begin recouping approximately $72 billion in improper payments made to Social Security claimants between 2015 and 2022.
These payments were either made to individuals in error or because individuals failed to notify the SSA about changes to their income, which could affect the amount of Social Security benefits they receive each month.
While the Trump administration is implementing some sweeping changes to the Social Security system in America, this overpayment recoupment was actually decided during the Biden administration. As Newsweek notes, in 2023, the SSA announced that those who received an overpayment in benefits would see 10% of future payments withheld until the total sum of the overpayments was recovered.
However, in March, the agency—now under Trump—announced that it would begin withholding 100% of an individual’s Social Security check until all overpaid monies were paid back. This 100% withholding sent shivers down the spines of many people who rely on their Social Security checks to pay for basic necessities, such as food and housing.
After backlash, the SSA said it will reduce the withholding to 50%. However, this is still a significant sum for many retirees and more than it’s been in the past.
Who will have 50% of their SS checks withheld?
The withholding of 50% of Social Security payments will affect approximately 2 million individuals.
If you are one of the individuals impacted, you should have already received notification from the Social Security Administration, which began sending letters about the upcoming withholdings in April.
How long will the 50% SS check withholding last? That depends upon how much an individual was overpaid in Social Security benefits in the past.
Their Social Security check will now have 50% withheld until the total sum of their overpayments is recouped by the agency.
The withholding is expected to begin with Social Security payments made around July 24, 2025.
Are individuals at fault?
Not necessarily.
While Social Security claimants need to inform the Social Security Administration of changes to their income so their payments can be adjusted, if necessary, not everyone who was overpaid was so because of action (or inaction) on their part.
It is possible that the Social Security Administration incorrectly calculated some people’s benefits, leading to the overpayment.
What if I rely on my entire Social Security check?
If you rely on your full Social Security check payment, and a 50% reduction would cause you challenges, there are a few options available.
First, you can manually repay Social Security check overpayments. Details on how to manually replay your overpayments can be found here.
A second option is to ask for an overpayment recovery waiver. You should apply for this waiver if you believe that your previous overpayments were not your fault or if you cannot afford the overpayment recovery cost.
You can find the Request for Waiver of Overpayment Recovery here.
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“If you are one of the individuals impacted, you should have already received notification from the Social Security Administration, which began sending letters about the upcoming withholdings in April.”
Burying the lede as usual. This is about people who are working side jobs after retiring. Making more than the maximum means they will reduce your SS check.
Depends on your age.......
You need to read the link again as you are incorrect in your statement. There is no reduction in SS after FRA. The $1 for $3 reduction you mention only applies in the year you reach FRA and stops at the month of your birthday and also has a higher income limit for that year or part of year, depending on your birth month.
Nope. If you are below your full retirement age, you can earn up to 23, 000 before SS cares. If you are past your full retirement age you can earn millions and SS does not care..
The article must be talking about people who collect SS payments before their full retirement age. They’re required to report their work income.
Also, sometimes Social Security makes mistakes in calculating payments. I’ve read other articles about people who had to pay back SS overpayments after SS made an error.
It only applies to ppl who retired between 62 and whatever their full retirement age is. If you retired at FRA, you can continue working with no cap on income and your SS payment isn’t impacted at all. In fact, it may even go up if you’re making more money than the highest 40 quarters in your employment history.
Thanks for clarifying.
“”The article must be talking about people who collect SS payments before their full retirement age.””
I don’t know HOW anyone could collect any RETIREMENT benefits BEFORE retirement age. There’s SSI - Supplemental...which I guess could be at any age..
You can collect social security as early as 62, but the payments will be lower, and if your work income exceeds a certain amount, the payments will be lowered further until you reach full retirement age. At least, that’s my understanding of it.
Learn something new every day....I knew there was another SS benefit besides the SSI I mentioned and that’s SSDI - Disability. Of course, there are others for spouse and survivor dependents...I’ve always wanted to meet the people who come up with these rules - ie Medicare etc. (not really).
My husband and I both retired at 65 so it wasn’t out of the ordinary - we both continued to work with usual deductions for SS etc., and our wages were reported as always by employers.
Retirement Benefits (Before Full Retirement Age – FRA)
For individuals receiving retirement or survivor benefits before reaching their designated FRA, an “annual earnings test” applies. Reporting earnings allows SSA to determine if income exceeds the yearly limit and if benefits need to be reduced accordingly. This test is a specific condition tied to receiving benefits early while still working.
Social Security Disability Insurance (SSDI)
SSDI is an insurance program for those unable to work due to a disability. Reporting work activity and earnings allows SSA to monitor work attempts through mechanisms like the Trial Work Period (TWP) and to assess whether earnings reach a level considered “Substantial Gainful Activity” (SGA). Reaching SGA levels can indicate an ability to work and may impact continued eligibility for disability benefits. The focus here is on how work relates to the program’s definition of disability.
I haven’t reached 62, yet, but I’m thinking about filing for early SS payments then.
“”I haven’t reached 62, yet,””
I wish I could remember being 62...was a long time ago!!! We officially retired in 2006 and moved from CA to GA..worked since the 1950’s including my husband’s military time in there somewhere also..
Yes, the trick is not to make more than $23,400
When you retired but kept working and contributing to SS, did your SS payments increase? I’ve been wondering how that works.
I don’t think there was any way to measure it as we just started to receive our benefits when we were eligible and applied at 65. There wasn’t a before and an after - if that makes sense. Our benefit amount changed from year to year because our wages were reported just like before. Hope I haven’t confused it for you.
Thanks for your response. Hope you don’t mind one more question: Did the benefit amount increase each year, or did it sometimes decrease?
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