Recovering Title II Overpayment from Title VIII and Title XVI Benefits, § 404.535

This blog post explains the Social Security Administration’s (SSA) guidelines for withholding amounts from your title VIII and title XVI benefits in order to recover a title II overpayment.

Here, we’ll break down the regulations set forth in § 404.535 to help you understand the process and your rights during this recovery.

Withholding from Past-Due Benefits: If you have past-due benefits, the SSA will withhold the lesser amount of either the entire overpayment balance or the entire amount of past-due benefits to recover the title II overpayment.

Withholding from Current Monthly Benefits: For recovering the overpayment from current monthly benefits, the SSA will withhold the lesser amount of either the entire overpayment balance or:

1. 10% of the monthly title VIII benefits payable for that month, and
2. For title XVI benefits, an amount no greater than the lesser of the benefit payable for that month or an amount equal to 10% of your income for that month (excluding certain payments and income).

Exceptions to Withholding Rules: The withholding rules mentioned above don’t apply if:

1. You request and the SSA approves a different rate of withholding, or
2. You or your spouse willfully misrepresented or concealed material information in connection with the overpayment.

Criteria for Granting Requests for Lower Withholding Rates: In determining whether to approve your request for a lower withholding rate, the SSA will use the criteria applied under § 404.508 to similar requests about withholding from title II benefits.

Withholding in Cases of Willful Misrepresentation or Concealment: If you or your spouse willfully misrepresented or concealed material information in connection with the overpayment, the SSA will collect the overpayment by withholding the lesser of the overpayment balance or the entire amount of title VIII and title XVI benefits payable to you. The SSA will not collect at a lesser rate.

Example: John receives both title VIII and title XVI benefits from the Social Security Administration (SSA). Due to an error in calculating his benefits, John has received an overpayment of $1,000 in title II benefits. To recover this overpayment, the SSA will withhold a portion of John’s title VIII and title XVI benefits.

John’s monthly title VIII benefits are $500, and his title XVI benefits are $600. His total monthly income, including both benefits, is $1,500.

To recover the overpayment from John’s current monthly benefits, the SSA will withhold:

1. 10% of his title VIII benefits, which is $50 ($500 * 10%)
2. For his title XVI benefits, the lesser of the benefit payable for that month ($600) or an amount equal to 10% of his income for that month ($1,500 * 10% = $150). In this case, $150 is less than $600, so the SSA will withhold $150.

In total, the SSA will withhold $200 ($50 + $150) from John’s current monthly benefits to recover the title II overpayment. It would take 5 months to recover the full $1,000 overpayment.

If John believes that this withholding rate will cause financial hardship, he can request a lower rate from the SSA.

Conclusion: It’s essential to understand the rules and processes surrounding the recovery of title II overpayments from your title VIII and title XVI benefits. Keep in mind your rights to request a different withholding rate and ensure you provide accurate information to the SSA to avoid complications in the recovery process.

https://www.ssa.gov/OP_Home/cfr20/404/404-0535.htm