Never Send Unsolicited Money to the SSA

Wait for the SSA to send you a letter asking for the funds to be repaid, so that they will be expecting the check. Andrey_Popov/Shutterstock

Every once in a while, I get an email from a reader with a horror story of sorts involving sending unsolicited money to the Social Security Administration to pay back benefits that were received but were not due.

Here is my advice: Never send money to the SSA until you are asked to do so. To explain this further, let’s look at some emails I recently received.

Q: I wasn’t working, so I applied for my Social Security benefits at age 62. But a couple of months later, I got a high-paying full-time job. So, I put in the paperwork to withdraw my Social Security claim. My checks eventually stopped. But not until I had received approximately $5,000 in benefit payments. So, I wrote out a check for that amount and sent it to the SSA. Months went by. The check was never cashed. I called the SSA’s toll-free number. They could find no record of the check. So, I canceled that check. Now what can I do?

A: As I said above, I would never send an unsolicited check to the SSA to pay back funds until you are asked to do so. As you learned, those checks just fall into a bureaucratic black hole. I’m sure your check ended up on someone’s desk somewhere within the agency and he or she was wondering: “What’s this all about? Why is this guy sending us all this money?” Somebody else somewhere else in the SSA was probably still processing your withdrawal application. So, it wasn’t in the computer system yet. The guy with the check had no idea what to do with the money. That’s my guess.

I suggest you just sit around and wait for the SSA to send you a letter asking for the funds to be repaid. Once they process your withdrawal request, that will start a chain of events that will lead to them sending you an overpayment letter informing you that you owe them the $5,000 or so in benefits they sent you before stopping your checks.

And once that overpayment paperwork is in the system, they will then be sitting there and waiting for you to send them a check. In other words, they will be expecting the check, and they will know what to do with it once you send it to them.

Q: I am 63 years old and have been getting Social Security benefits for about a year. I am taking a job that will pay me about $30,000 this year, and I know that I will not be due all of my Social Security benefits for 2021. Should I just start returning the money to them? How do I handle this?

A: Same advice. Do NOT “just start returning the money to them.” What you should do is call the SSA at 800-772-1213 and report the fact that you have returned to work and how much you think you will make this year.

Once someone processes that information, that will generate an overpayment letter that will be mailed to you. When you get the letter, follow the instructions. They will tell you how much money you owe back and where to send that money.

And now I’m going to turn the tables a bit. So far, I’ve been talking about situations where people know that they have received Social Security benefits they are not due, and I told them to wait for that overpayment letter before sending any funds to the SSA. But more than a few of you will get an overpayment letter you were not expecting. In other words, for some reason, you got some Social Security benefits that the SSA alleges you were not due. How do you handle that situation?

Actually, the overpayment letter includes instructions for dealing with the situation. And my book, “Social Security: Simple and Smart,” has an entire section devoted to handling alleged overpayments. (Ordering instructions for the book are at the end of the column.) But here is a very brief overview.

If you acknowledge the fact that you received benefits you are not due, and if you are still getting monthly Social Security benefits, the overpayment letter usually says that the SSA will withhold your full monthly checks until the overpaid amount has been recovered. If you are OK with that, there is nothing you need to do.

If you do not want to or cannot afford to have your full monthly benefits withheld, you can ask that the overpayment be held back in monthly installments.

If you are no longer getting Social Security benefits when you receive an overpayment letter, you write a check for the amount of the overpayment payable to the Social Security Administration and send it to the address they give you. Or you can work with the SSA to repay the amount in monthly installments.

If you do not agree that you are overpaid, or you simply are confused about the alleged overpayment, then you should start out by calling the SSA and asking for an explanation.

If you are not satisfied with the explanation given, or if you simply still do not understand the reason for the overpayment, you should file a formal appeal of the overpayment. You will probably be asked to fill out a “Request for Reconsideration” form. On that form, you will indicate why you disagree with the overpayment decision.

Your claim will be reviewed by someone within the SSA who was not involved in the first decision that you were overpaid. And this will eventually result in a second letter to you containing another decision about your overpayment. If it is a favorable decision (meaning you are not overpaid), then your case is essentially closed.

But if the reconsidered opinion upholds their initial allegation that you are overpaid, you must either accept their decision and make arrangements to repay the overpayment or consider an overpayment waiver request.

If you accept the fact that you have been overpaid, either before or after asking for a reconsideration, you can ask the SSA to waive (write off) the overpayment if BOTH of the following conditions are met: 1. You can prove (by filling out financial statements) that you cannot afford to repay the money; and 2. You can prove that the overpayment was not your fault.

Tom Margenau worked for 32 years in a variety of positions for the Social Security Administration before retiring in 2005. He has served as the director of SSA’s public information office, the chief editor of more than 100 SSA publications, a deputy press officer and spokesman, and a speechwriter for the commissioner of Social Security. For 12 years, he also wrote Social Security columns for local newspapers, and recently published the book “Social Security: Simple and Smart.” If you have a Social Security question, contact him at [email protected].