The Social Security Administration has halted a plan to withhold 100% of many beneficiaries’ monthly payments to rectify overpayments made by the government. Instead, the agency will default to withholding only 50% of old-age, survivors, and disability insurance benefits. Previously, the Joe Biden administration had implemented a policy to limit the clawbacks to 10% of monthly payments, but this was reversed under the Trump administration.

The Social Security Administration often pays beneficiaries amounts they shouldn’t have received and then demands the money back, often after much time has passed and the amounts have significantly risen. Previously, this recollection process involved withholding 100% of monthly benefits. Many beneficiaries, including those living just above the poverty line, have received overpayment notices, with clawbacks effectively leaving some homeless.

Acting Commissioner Lee Dudek justified the return to the 100% clawback policy, saying it was necessary to properly safeguard taxpayer funds . Now, this policy has been partially reversed, defaulting back to a 50% withholding rate. However, this withholding rate is still a cause for concern, as it could cause hardship for many older and disabled people, according to Kathleen Romig, director of Social Security and disability policy at the Center on Budget and Policy Priorities.

While this downward shift in withholding from 100% is welcome, some still express disappointment that the agency didn’t return to the 10% rate. This confusion and inconsistency with policies creates more work for the Social Security Administration, with more people calling with questions, more errors that need to be rectified and more uncertainty about the situation.

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