Social Security Checks Could Be Slashed 50% Starting This Week As New Rule Targets $23 Billion Overpayment Recipients

Social Security beneficiaries who previously received excess payments could see their monthly checks cut in half as early as next week, after the agency's new recovery rules take effect on Thursday.

What Happened: In April, the Social Security Administration (SSA) began mailing overpayment letters that give recipients 90 days to seek a waiver or negotiate a lower repayment rate. When the grace period lapses, the agency will automatically withhold 50% of each check until the debt is cleared.

The timetable means some retirees whose birthdays fall between the 21st and 31st of the month will feel the cut on their July 23 payment. The next round of checks, scheduled for August 1, will reflect the new claw‑back for others.

Overpayments occur when the SSA miscalculates benefits or recipients fail to report income changes, according to the SSA. Improper payouts represented less than 1% of the $8.6 trillion issued from fiscal 2015‑2022, yet the agency is still trying to recover about $23 billion, according to its inspector‑general.

See Also: No More Paper Checks From Social Security After Sept. 30 — Here’s What You Need To Do Now

While some checks shrink, others are rising. Under the Social Security Fairness Act, the agency finished sending more than 3.1 million retroactive adjustments, worth roughly $17 billion, to public‑sector workers such as teachers, firefighters and postal employees by July 7. The average back‑payment was $6,710, and the agency has processed 92 % of 278,000 new claims filed since the law took effect on January 5.

Why It Matters: Beneficiaries who receive an overpayment notice can repay online, by check or credit card, or ask the agency to waive or reduce the liability if recovery would be unfair or create hardship. Failure to act within the 90‑day window triggers the 50% garnishment.

Overpayment notices can be disputed too, although the process isn’t as straightforward. Beneficiaries can request a reconsideration, a waiver, or a lower withholding rate. However, responses can vary depending on the SSA employee handling the case.

Read Next:

• If I Were A Beneficiary, I’d Be Setting Aside Some Money Right Now’ Former SSA Commissioner Warns That Payments Could Be Disrupted Soon

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