In a bizarre case of owing money to the Social Security Administration, a Reddit user recently received a letter from the agency. They expected it to be regular paperwork; however, what caught them by surprise was when they found out that it was a notice. They received a notice from the federal agency stating that they owe the agency $11,000 in overpaid benefits.
However, the most interesting tweak in the story is that the original poster never received any funds.
Upon further reading, they realised that the debt stems from disability benefits that were once paid to their father. Their father received these benefits after a workplace injury. At the time of the payment, the Reddit poster was a child. They claim that as a child, they never saw the money or handled any part of it.
As luck would have it, they had a falling out with their father, and he disappeared entirely about four years ago.
And now, decades later, this sudden demand for repayment has left them puzzled and panicked.
“I have no idea what I’m supposed to do,” the user wrote, adding that they’d never been in debt before and were “extremely stressed out” by the claim.
Before understanding this case, one must understand what SSA overpayment is! The SSA defines an overpayment as when one receives more money than they should have been paid.
This can happen for a number of reasons. There could be a change in income, work activity, or living arrangements. When such life changes happen and beneficiaries do not update their account details, they are sometimes paid more than they owe.
Sometimes, these overpayments are linked to benefits issued on behalf of children.
Whenever there is an overpayment, the SSA sends a letter. The letter explains the amount owed, the reason for the claim, repayment methods, and the recipient’s rights to appeal or seek a waiver.
In this case, the letter has named the adult child as responsible for benefits tied to their father’s claim. Though the Reddit poster was a minor at the time and had no control over the money.
This post has sparked a flood of responses from Reddit users. There are many who have faced similar situations. Among these there are many who emphasized that there are formal processes in SSA to contest or resolve overpayments.
One commenter has advised them to fill Form SSA-632. It is a Request for Waiver of Overpayment Recovery. They can cite the fact that the user was a minor when the benefits were issued. Others have noted that minors typically are not held liable for funds paid to a parent or guardian.
The SSA offers two primary tools to dispute an overpayment:
- Appeal the decision by filing Form SSA-561, Request for Reconsideration, within 60 days of receiving the notice. This is appropriate if the person believes the overpayment amount is incorrect or that no overpayment occurred at all.
- Request a waiver with Form SSA-632 if the recipient believes the overpayment was not their fault and repayment would be unfair or cause financial hardship. Unlike appeals, waiver requests have no strict deadline.
If someone puts up an appeal or a request for waiver, the SSA pauses the efforts to collect the debt. However, if ignored, the agency can recover overpayments by withholding federal income tax refunds or garnishing future benefits.
