On April 25, 2025, the Social Security Administration (SSA) issued Emergency Message (EM) 25029 implementing a default withholding rate of up to 50 percent of a person’s monthly benefit for Title II overpayments beginning as of that date. The action partially reverses a change that SSA had made less than two months prior, on March 7, 2025, when SSA had announced by press release that it would reinstate a default overpayment rate of 100 percent.
Full recoupment for Title II overpayments was SSA’s policy until it was changed about a year ago by then-Commissioner Martin O’Malley. As reported in the April 2024 issue of this newsletter, SSA dropped the “heavy-handed practice” of recouping the entirety of a Social Security beneficiary’s monthly benefit and changed the default rate to ten percent of the monthly benefit or $10, whichever is greater. The changes followed a comprehensive review of overpayment policies launched in response to public outcry about the devastating consequences faced by claimants with huge overpayments. O’Malley described overpayment-related hardships as “injustices” that “shock our shared sense of equity and good conscience as Americans,” and said that policies aimed at easing the burden of overpayments were “important steps to restore efficiency and humanity to this process.” SSA issued EM-24011 SEN on March 25, 2024 to implement that change. The EM had a retention date of October 25, 2024.
When SSA announced in March that it was reverting to a default of 100 percent, it stated that it would apply the new rule to overpayments issued on or after March 27, 2025.
Under the new EM, any new Title II overpayment notices issued beginning April 25, 2025 “will provide a default Title II overpayment benefit withholding rate of 50 percent. This default rate will apply if the individual does not request a lower rate of withholding, reconsideration, or waiver. EM-25029 states that the 10 percent rate will apply to all overpayment recovery actions “up through COM 07”.
While this policy represents a rollback in protections for claimants, advocates should remember that there were several other reforms passed last year that still can aid in obtaining a more fair result for clients with overpayments. As summarized in the January issue of this newsletter, the changes were incorporated into SSA’s POMS, and advocates should be sure to reference those tools when advocating for a waiver.
The rate does not apply if there is a fraud conviction or determination. Also, the default withholding rate for Supplemental Security Income (SSI) overpayments remains unchanged at 10 percent.
