Donald Trump’s administration has announced a new policy raising the overpayment recovery rate to 50% for retirees. This move is aimed at improving the fiscal accountability of the Social Security Administration (SSA).
This change has been implemented in coordination with Department of Government Efficiency (DOGE). It marks a distinct change from the previous lenient policies and will surely make a significant impact on the benefits of social security recipients. This will be implemented from late July 2025.
The issue of overpayments of social security benefits has always plagued SSA, and this policy targets the recovery of said overpayments. Between 2015 and 2022, there were improper payments of almost $72 billion. Among these improper payments, overpayments make up the majority.
These errors are typically due to delay in updating the information that directly or indirectly affects the benefit amount. When there is a failure to report changes in employment or marital status, there are clerical missteps that affect the SSA payments.
Commissioner Bisignano highlights DOGE assisting Social Security in the fight against fraud, waste, and abuse: “The work that DOGE did was 100% accurate. They were identifying opportunity for fraud… Partnering with DOGE has been tremendously valuable.” pic.twitter.com/fh38kd1tQW
— SocialSecurity_Press (@SSAPress) May 21, 2025
The SSA has mailed out overpayment notices on April 25, 2025. This was a part of the policy roll-out to inform the recipients if there will be a cut of up to 50% of the social security check amounts.
The new standard has now replaced the previous 10% recovery cap. This cap was instituted during the Biden administration, but a change in this percentage now signals a renewed focus on efficiency and cost recovery.
Beneficiaries who have received overpayment in the past have received notices regarding it. They have a 90-day window to respond. During this period, individuals can:
- If they believe the overpayment was made in error, they can request reconsideration by filing Form SSA-561
- If repaying 50% would create financial hardship, recipients can request a lower withholding rate using Form SSA-634
- If they cannot afford to repay any amount, they can request a full waiver of recovery via Form SSA-632
If there are recipients who do not act before the late July deadline, they stand to have their social security benefits by 50%. This will continue until the full overpaid balance has been repaid to SSA.
This new standard will affect retired workers, spouses, and survivors. Many of the people rely heavily on social security payments for basic living expenses.
Our Retirement is our responsibility!
Our social security is best being overseen under our personal stewardship!
Currently Social Security is nothing more than an IOU!
It is not a Trust account!
And does not return value on the money you receive. It’s doubtful it provides any… pic.twitter.com/wpmgU8vAGo— Dave Wallace, Restore America’s Mission (@DaveWallaceUS) July 5, 2025
The SSA anticipates saving around $7 billion over the next decade from this initiative and replenishing the coffers of Social Security. However, experts believe this figure represents only 0.2% of the total projected Social Security shortfall.
The Old-Age and Survivors Insurance (OASI) Trust Fund is responsible for distributing Social Security benefits. And based on the current data, even after collecting the money, it will remain on track to be depleted by 2033.
Reports claim that if Congress does not address the growing deficit, scheduled benefits could be cut by up to 23% beginning in 2033. The increase in recovery efforts definitely contributes to fiscal responsibility, yet it is not a long-term solution to the Trust Fund’s impending future.
The increase in overpayment recovery rate shows that the Trump administration is getting more aggressive towards fiscal management, yet it gave severe tax breaks to the super wealthy in its big beautiful bill.
