Big news from the Social Security Administration: Starting April 25, 2025, the SSA will no longer withhold 100% of your monthly payment if you were overpaid. Instead, they’ll cap the deduction at 50%—a change that could ease the financial strain on millions of Social Security beneficiaries.
If you’re on retirement, survivor, or disability benefits and got hit with an overpayment notice, here’s what you need to know.
Policy
This change affects recipients under Title II, which includes retirement, survivor, and Social Security Disability Insurance (SSDI) benefits. Instead of losing your entire check, the SSA will now withhold a maximum of 50% of your monthly payment to recover the debt.
This rollback comes just a month after a controversial March policy that allowed 100% clawbacks, sparking outrage from advocacy groups and lawmakers.
Withholding Comparison
| Beneficiary Type | Previous Rate | New Rate | Effective Date |
|---|---|---|---|
| Retirement/Survivor/SSDI | 100% | 50% | April 25, 2025 |
| SSI (Supplemental Income) | 10% | 10% | No Change |
Impact
While the reduction helps, losing half your check is still tough. Most people on Social Security rely on these payments for the basics—food, rent, medicine. Taking even 50% can mean missed bills or worse, homelessness.
Kate Lang, an advocate from Justice in Aging, put it bluntly: “Obviously, it’s better not to lose all of your income. But if you’re relying on your benefits to pay your rent or your mortgage and buy food, losing half can still be devastating.”
This is especially true for SSDI recipients. They average around $1,538 a month. Losing half of that? You’re left with less than $770. That’s not even enough to cover rent in many places.
Mistakes
Here’s the kicker—most overpayments aren’t your fault. According to a 2022 watchdog report, thousands of these errors were due to the SSA’s own systems, not fraud or misreporting. A lack of automation and miscalculations triggered over 73,000 overpayments that year alone.
And yet, the agency expected to reclaim up to $700 million a year using 100% withholdings—a plan pushed by Acting Commissioner Lee Dudek and the so-called Department of Government Efficiency (DOGE).
Thankfully, public pressure forced the rollback.
SSDI Rules
A common issue with SSDI recipients is confusion over income rules. You’re allowed to earn up to $1,620 per month, but anything over that must be reported. Many people don’t even know they’ve crossed the limit—until the SSA sends a letter demanding thousands back.
This is how people get caught off guard. One wrong paycheck and you’re suddenly labeled “overpaid.”
Options
If you’ve been hit with an overpayment and can’t afford the new 50% deduction, don’t panic. You’ve got options—but you’ll need to act quickly.
You have 90 days to:
- Request a lower withholding rate
- Apply for a waiver if the overpayment wasn’t your fault and you can’t afford to repay
- File for reconsideration if you think the SSA made a mistake
But be warned—these processes aren’t easy. They involve paperwork, long waits, and sometimes legal help. Still, it’s better than doing nothing and losing half your income.
FAQs
What is the new SSA withholding limit?
The SSA now withholds a maximum of 50% of monthly benefits.
When did the 50% policy begin?
It took effect on April 25, 2025.
Does this apply to SSI?
No, SSI still has a 10% withholding limit.
Can I ask for a lower rate?
Yes, within 90 days you can request a lower rate.
What causes most overpayments?
Mostly SSA system errors and unreported income.
