How to Negotiate an SSA Overpayment
SSA has a number of programs designed to help you rejoin the workforce. For example, the Trial Work Period program allows you to collect your disability benefits while you start a job. If your job attempt is unsuccessful, you do not lose your benefits and you do not have to start the disability application all over.
Unfortunately, SSA can sometimes be a bit sloppy with its bookkeeping. If you are receiving a benefit check and you begin to ease back into the workforce, you need to be careful that you are not being overpaid.
If you are working, your employer will submit wage and income information to the IRS and the Social Security Administration. SSA’s computers will cross match your Social Security number with its database of disability recipients and any overpayment will be identified, eventually.
If you have received a letter from Social Security that you owe an overpayment, it is very important that you take immediate action. If SSA is truly in error, you can file an appeal of the overpayment decision and ask for a hearing. If SSA is correct in its calculations, there is a procedure where you can ask for a waiver of overpayment recovery or a change in repayment rate.
SSA form SSA-632-BK is the correct form to use to request a waiver. You can download SSA-632-BK here. Note that this form asks for a great deal of personal financial information. The problem, of course, is that by filling out this form, you are giving SSA a roadmap to your finances. If they turn you down, they will know exactly where to go to collect the overpayment.
On the other hand, if you do nothing, SSA will pursue bank account levy, wage garnishment or any other means to collect. If possible, you should seek advice from a CPA or accountant to assist you with this form. Most disability lawyers do not deal with overpayment issues (unless there is a hearing scheduled). You may be able to find help with overpayment issues on specialty search engines like Site Catch or Plome Directory. Accountants will be familiar with the concept of negotiating what amounts to an installment agreement or offer in compromise with the IRS. SSA’s form 632 is similar to the IRS forms for waiver or request for payment terms for past due taxes.