You Can Appeal a Social Security Overpayment Notice
Last year, Social Security’s Office of the Inspector General reported that the agency had paid nearly $11.3 billion in improper payments in 2025, with 9.3 billion attributed to overpayment of benefits. The SSA identified the main cause for the overpayments as the application of the annual earnings test. Read the full report from the Office of the Inspector General (OIG) here. Currently, a bill named the Senior Citizens Freedom to Work Act of 2026 has been submitted. Read the entire bill here… Only time will tell if it will pass, but if it does, it will end the earnings limit.
In any event, the SSA requires individuals to report any changes, and if you don’t, benefits may continue to be paid at an incorrect level, resulting in overpayment. When an overpayment is detected, SSA will send you a notice explaining the overpayment and asking for repayment.
You Received an Overpayment Notice…Now What?
If you receive an overpayment notice from Social Security, don’t panic. You have the right to appeal it. Whether it is because you don’t agree with owing the money, or because the repayment would cause you financial hardship, there are steps you can take. When you receive the first notice, you must respond within 30 days, or Social Security will start withholding 50% of your payment. (You use this same process if you are denied Social Security Disability benefits or any other type of benefit you feel you are entitled to.)
The Appeal Process
You have four opportunities to appeal a decision. However, you may not have to go through all four appeal levels.
1) You should begin by filing a “Request for Reconsideration,” Form SSA-561. You can print and complete the paper form and return it to your local office, or you can file an appeal through your Social Security Account online.
NOTE: If SSA denies your Request for Reconsideration, and you want to request a waiver of payment because the overpayment was not your fault or would cause you financial hardship paying it back, you have the option to file Form SSA-632. You must print this form and return it to the Social Security Administration. There is no time limit for filing this form.
2) You may request a hearing by an administrative law judge (ALJ) if Social Security denies your request. The hearing is a review of your claim by an ALJ who didn’t take part in your first request for reconsideration. Complete Form HA-501 and send it to your local office. You may also request a hearing online. Your local office will send your request for a hearing to a hearings office. You will be sent a notice once your hearing is scheduled. You will also receive information about the hearing process.
3) You may ask the Appeals Council to review your case if you don’t agree with the ALJ’s decision. You may send a request for Appeals Council review online or complete Form HA-520 online. (You may also mail or fax the form to your local office.)
4) The last level of the appeals process is to file a civil suit in a federal district court. File a civil action in the closest U.S. District Court. Click here to locate the appropriate district Court. Send copies of the complaint and court summons to the Social Security General Counsel office in your area. It is advisable to send these documents via certified or registered mail.
Clarifying the Current Repayment Schedule
Many affected beneficiaries are aware that SSA recently began withholding up to 50% of the monthly benefits for those determined to have received overpayments. Previously, the clawback process allowed for 100% reclaiming of monthly benefits, but public outcry resulted in reducing the maximum benefit impact to 10%, a temporary cap that expired last year. The benefit reductions continue to apply until the overpayment balance is reduced to zero.
Much has been written about the relative fairness of the claw-back process, especially in those situations where the Social Security recipients were not at fault. It is hoped that, with improved monitoring processes, future occurrences of the details leading to overpayments can be minimized.
Here at The AMAC Foundation’s Social Security Advisory service, questions about overpayments are among those most frequently asked. If you have questions about Social Security, contact us at SSadvisor@amacfoundation.org or at 1-888-750-2622.
This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). NSSA, the AMAC Foundation, and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at ssadvisor@amacfoundation.org.