00:00:00 Brad Smith
Every year, the Social Security Administration issues nearly $1.5 trillion in benefits to 73 million recipients across the nation. And for 2 million of them, those payments could be cut in half as soon as this month. For more, Yahoo Finance Senior Columnist, Kerry Hannon joins me now. So Kerry, why is the government cutting these benefits?
00:00:25 Kerry Hannon
Yeah, Brad. This is uh, something that’s been in the works for a while, and it’s actually been going on. It’s the amount that um, Social Security overpaid people, uh, in their Social Security monthly check. And that could have happened because the agency miscalculated how much someone could get paid, or, uh, a beneficiary didn’t, um, notify the agency when they had a change in their income. So this impacted quite a few people. And by law, the agency has to recoup these overpayments. So in order to do that, it had been at 10% of each check until the total amount had been paid back to Social Security. But in March, the Trump administration announced it was going to be 100% until it got paid back. Now, that caused a lot of alarms to go off, and people were, were pretty frightened because if they depended on their Social Security check to pay their monthly bills, this was a big deal. Um, a couple of weeks later in April, they backed down and said, “Okay, it’s going to be 50%”, and this is going to start in July. So at the, during this month, probably towards the end of the month, uh, these checks are going to start, uh, being, uh, clawed back is the term they like to use, but it’s, it’s giving the government back money that was overpaid.
00:02:34 Brad Smith
So if you received an overpayment, what steps can you take?
00:02:41 Kerry Hannon
You know, Brad, there are things you can do. Um, and you should have received a notice. Um, they give you a 90-day notice. Uh, and the steps that you can do are, getting, go to the Social Security website and you can, uh, if you can pay it, you know, just pay it, uh, by credit card or by check or what have you. Um, if you can also ask for them to, to make it smaller amounts, and that you have to file a form to make that request, and you have to have documentation. I, I presume, I don’t know exactly what you need, but they will consider smaller payments. You can also ask them, um, you know, that, that you just actually want to waive it because you don’t believe, um, it was your fault that you were overpaid, or you can, uh, file for, what is called a reconsideration, which, uh, is, is basically saying you don’t think that the calculation was wrong. Um, so there are a couple of steps, and I encourage people that it, that if they need to do so, please take action and, um, and see what you can push forward because it can, for many individuals, this can be a big chunk of their monthly check.
00:04:34 Brad Smith
Kerry, thank you so much. Appreciate the breakdown here.
