Lawmakers Demand Answers on Social Security Overpayments Linked to COVID-19 Stimulus

Lawmakers Demand Answers on Social Security Overpayments: Some Americans said that they are being asked to repay money on their Social Security payments or that their income has been cut off because of claims that they were overpaid for COVID-19 stimulus checks.

Several news sources say that some people who get Social Security or Supplemental Security Income (SSI) have had their benefits stopped or have been overpaid because they got stimulus checks worth up to $3,200 per person or $6,400 per married couple. They were made between April 2020 and July 2021, though, and were not meant to count against Social Security benefits.

A number of democratic lawmakers have looked into the case because they are worried that people who received COVID-19 stimulus will have to pay a fine. This was written in a letter to the Social Security Administration (SSA) by Sens. Ron Wyden (D-Ore.), Sherrod Brown (D-Ohio), and Bob Casey (D-Penn.).

The senators wrote to SSA Acting Commissioner Kilolo Kijakazi, “We are deeply concerned that [SSI] beneficiaries are receiving overpayment notices in error because SSA is not following its own determination to exclude Economic Impact Payments [stimulus checks] from countable resources.” “As you know, SSI benefits, while modest, have a substantial impact in the lives of the people who rely on them.

“Benefit suspensions and overpayment notices – regardless of the cause – can have a profound negative impact in their lives. Further, losing SSI eligibility risks a lengthy bureaucratic process to restore eligibility and also risks beneficiaries’ access to Medicaid coverage.”

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Lawmakers Demand Answers on Social Security Overpayments

The Social Security Administration (SSA) recently said it would look at how it handles overpayments of Social Security benefits. If Americans think they shouldn’t have to pay, they can get their money back or a waiver.

About 0.5 percent of the time, people who get Social Security income may have been overpaid. For overpayments of the Supplemental Security Income (SSI) program, that number goes up to 8%. An SSA statement says that from 2015 to 2019, the agency gave about $283.4 billion to people who received SSI. Of that amount, about $21 billion (7%) was thought to have been extra. A report from the SSA’s inspector general says that the agency got back $4.7 billion in overpayments during the fiscal year of 2022.

Kijakazi said that the government wants to make it easier for Americans who think they were overpaid to file appeals and get waivers. Some changes have already happened, like the release of a new, easier-to-use permission request form. The form is easier to understand, which makes asking for a waiver of debt collection easier. SSA is also working on a new electronic payroll data exchange program that will use information about wages to change payment amounts automatically when needed to avoid overpayments. The agency also plans to release a proposed rule that will simplify and ease the process so that qualified people can more easily get debt relief.

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Some people who have money owe more in taxes

The Senior Citizens League (TSCL) says that in 2024, the benefits of Social Security and SSI for more than 71 million Americans will go up by 3.2%. This will put some recipients at a higher income tax rate.

People who got the money got raises of 8.7% in 2023 and 5.9% in 2022. These were the biggest raises since the early 1980s because inflation was so high. TSCL said in a poll that up to 26% of people who have been getting Social Security for more than three years said they paid taxes on some of their benefits for the first time during the 2023 tax season. Because the COLA went up a lot in 2023, an even bigger chunk of people will probably have to pay taxes on their benefits in 2024.

TSCL warned seniors may not be able to get SNAP and rental aid if their incomes increase due to the big COLA increases.

“Up to 85% of Social Security benefits can be taxable when income exceeds certain thresholds,” TSCL said. “Unlike other parts of the federal income tax code, the income thresholds that subject Social Security benefits to taxation have never been adjusted for inflation. Consequently, as Social Security income increases due to COLAs, that can bump more retirees into the thresholds that triggers the tax on their Social Security benefits.”