Jessica Melton a disabled woman from Tennessee faced a shocking financial challenge when her Social Security payments dropped to $14 a month due to overpayment issues. The Social Security Administration (SSA) claimed she had been overpaid $12,000 leaving her struggling to repay the amount despite the overpayment not being her fault initially.
How did Overpayments happen?
Overpayments occur when the SSA provides recipients more money than they are entitled to receive. While this can happen due to beneficiaries failing to update their income, marital status or living situation errors on the SSA’s part are also a factor.
In 2022 alone over 1 million Americans received overpayment notices, with the SSA attempting to recover $4.7 billion out of an estimated $23 billion in overpayments. These mistakes, though rare, can have severe financial consequences for individuals reliant on these benefits.
Jessica’s Case: A Closer Look
Jessica Melton who relies on Supplemental Security Income (SSI) checks due to her disability, was told she had been overpaid for years. The SSA claimed her husband’s income exceeded the $3,000 monthly limit for married couples, which disqualified her from receiving benefits.
However, Jessica and her husband, Jason, argue that their income has always been within the limit. Despite this the SSA adjusted her payments to recover the $12,000 overpayment, reducing her monthly checks to just $14.
Jason explained that the SSA deemed Jessica ineligible for SSI because she was self-employed while receiving the payments. He added, “It’s a lot of red tape. My wife was making a little bit of money. Now that money is gone.”
The couple now faces the difficult decision of appealing the SSA’s decision within the next two months, a process they find confusing and overwhelming.
Why Overpayments Are a Problem
Kevin Thompson, a financial literacy instructor, explains, “Overpayments in the SSI program are more common because benefits are means-tested. Eligibility and payment amounts depend on income and resources, which must be reported monthly.”
Michael Ryan, a finance expert, highlights another issue: “Social Security is complicated—like a maze where the rules constantly change. Even a small mistake, like reporting income late or incorrectly, can lead to significant overpayments.”
For more details on payments and important updates about Social Security, check out our article on 65 Year Olds to Receive Social Security Checks of $1,622 in February 2025
What to Do If You Receive an Overpayment Notice
For Americans facing overpayment notices here’s what experts suggest:
Contact the SSA Immediately
Request a detailed breakdown of the overpayment calculation to understand how the amount was determined.
File an Appeal
You have 60 days to file an appeal if you believe the overpayment is not your fault.
Request a Waiver
If repaying the amount causes financial hardship, you can request a waiver. The SSA may reduce or eliminate the repayment amount if your case qualifies.
Work Out a Repayment Plan
The SSA recently reduced default withholdings to 10% of monthly benefits to ease financial strain. You can negotiate a repayment plan based on your circumstances.
FAQs
What’s Next for Jessica?
Jessica has the option to request an administrative review of her case but she must act within two months. In the meantime she and her husband remain confused about how to proceed.
What causes Social Security overpayments?
Overpayments can happen due to errors by the SSA, unreported income changes, or incorrect information on forms.
How can I avoid Social Security overpayments?
Regularly update the SSA with changes in income, living arrangements, or marital status to stay compliant.