If you've received a letter from the Social Security Administration saying you owe money back, you're not alone—and you're probably wondering what went wrong. SSA overpayments are one of the most common (and stressful) issues that disability benefit recipients face, and understanding how they happen is the first step toward avoiding them.
In this article, we'll cover:
- What an SSA overpayment is and why it happens
- The most common reasons people get overpaid
- How overpayments differ for SSI vs. SSDI recipients
- What happens when Social Security says you owe money
- Steps you can take to avoid an overpayment
- How to respond if you receive an overpayment notice
What Is an SSA Overpayment?
An SSA overpayment occurs when Social Security determines that you received more money in benefits than you were entitled to during a specific period. This can happen with both SSI and SSDI benefits, and the reasons vary depending on which program you're in. When Social Security discovers the overpayment, they'll send you a notice explaining how much you owe, why it happened, and how they plan to collect the money.
The frustrating part is that overpayments often aren't your fault. Processing delays, reporting lags, and the sheer complexity of benefit rules mean that even people who do everything right can end up owing money back.
Why Do Overpayments Happen?
For SSI recipients, overpayments most commonly happen because of changes in income or resources that weren't reported quickly enough—or that Social Security didn't process in time. Since SSI has a strict $2,000 resource limit for individuals ($3,000 for couples), even temporary changes can trigger an overpayment. If you received a gift, started a part-time job, or had a change in your living situation, your SSI payment should have been adjusted. If it wasn't adjusted in time, you may have been overpaid.
For SSDI recipients, overpayments often relate to work activity. If you earned above the Substantial Gainful Activity (SGA) limit of $1,690 per month in 2026 without reporting it—or if Social Security continued paying you after your Trial Work Period ended—an overpayment can result. SSDI overpayments can also happen when there's a change in your disability status following a Continuing Disability Review (CDR).
Other common causes include unreported changes in marital status, receiving benefits from another source (like workers' compensation), or errors on Social Security's end.
What Happens When You're Overpaid
Once Social Security identifies an overpayment, they'll send you a notice that includes the amount you owe, the time period it covers, and how they plan to recover the funds. For SSI, they typically withhold 10% of your monthly benefit until the overpayment is repaid. For SSDI, they may withhold your entire monthly payment until the debt is cleared, though you can request a lower withholding rate.
It's important to know that you don't have to simply accept an overpayment notice. You have rights, including the right to appeal if you believe the overpayment amount is wrong, and the right to request a waiver if repaying would cause financial hardship.
How to Avoid an SSA Overpayment
The single most important thing you can do is report changes promptly. Social Security requires you to report changes in income, resources, living arrangements, and marital status within 10 days for SSI. For SSDI, you should report any work activity as soon as it begins.
Keep detailed records of everything—pay stubs, bank statements, and any communications with Social Security. If you're an SSI recipient, monitor your bank account balance carefully to make sure you stay below the $2,000 resource limit. Using a tool designed for benefit compliance, like Purple's checking account, can help you track your resources in real time and avoid accidentally going over the limit.
If you're working while receiving SSDI, make sure you understand the Trial Work Period rules. In 2026, any month you earn more than $1,210 counts as a trial work month. You get nine trial work months within a 60-month rolling window before your benefits may be affected.
What to Do If You Receive an Overpayment Notice
First, don't panic. Read the notice carefully and make sure the information is accurate. Check the dates, amounts, and the reason given for the overpayment. If anything looks wrong, you have 60 days to file an appeal (called a "Request for Reconsideration").
If the overpayment is accurate but you can't afford to pay it back, you can request a waiver by filing SSA Form 632. Social Security may waive the overpayment if you can show that it wasn't your fault and that repaying it would deprive you of money needed for ordinary living expenses. You can also request a different repayment plan if the standard withholding rate is too high.
Consider reaching out to a legal aid organization or benefits counselor if you need help navigating the process. Many communities have free resources available for people on disability benefits.
Staying Ahead of Overpayments
The best way to deal with overpayments is to prevent them in the first place. Stay organized, report changes quickly, and keep a close eye on your income and resources. Understanding the rules that apply to your specific benefit program—whether SSI, SSDI, or both—puts you in the best position to avoid surprises.
Worried about staying compliant with Social Security's rules? Purple's checking account is built specifically for SSI and SSDI recipients, with tools to help you monitor your resources and avoid overpayments before they happen.