Overpayments of Social Security Disability Benefits

May 2015 Newsletter

Overpayments of Social Security Disability Benefits

An overpayment of social security disability benefits arises when the Social Security Administration has paid the recipient in excess of the amount that was actually due. The Commissioner of Social Security is authorized to collect the overpayment either by reducing the recipient’s future payments, requiring the recipient or his estate to repay the excess amount, or by reducing the recipient’s tax refund by the excess amount.

When an overpayment results through no fault of the recipient, the Social Security Administration (SSA) will not seek reimbursement if it would defeat the purpose of the Social Security Act or would be against equity and good conscience. When determining the recipient’s “fault,” or lack thereof, the Commissioner will examine any mental, physical, educational, or language limitation from which the recipient suffers. The SSA’s policy declares that an overpayment is against “equity and good conscience” if the recipient has changed his position for the worse or relinquished a valuable right due to reliance on the notification of payment or the overpayment itself. The Ninth Circuit Court of Appeals has held the SSA’s definition to be unduly restrictive finding that it was Congress’ intention that a broad concept of fairness apply, taking into account the facts of each case.

Posted in Newsletter, Workers Compensation Newsletter.