Overpayment from Social Security? You Might Owe Thousands

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socialsecurity2013 When many consumers receive payment from Social Security, they don’t question it. They assume that the Social Security Administration knows what it’s doing, and they accept the money. However, it appears that, in some cases, mistakes have been made and over-payments have been issued.

Once the Social Security Administration realizes what’s happened, it begins to look for ways to rectify the problem. And that often means that consumers are asked to repay what they shouldn’t have received in the first place. According to Yahoo! Finance, that can mean tens of thousands of dollars.

Could you handle repaying the IRS?

According to Yahoo! Finance, some of these consumers are people who even tried to bring the overpayment problem to the attention of the Social Security Administration. In one case, a consumer trying to report the problem was told that the payments were being made to make up for a previous underpayment. However, she asked to repay tens of thousands of dollars in overpayment a little while later.

While some of the $1.3 billion in Social Security overpayments are due to fraudsters, there are plenty of innocent bystanders who find themselves in a tough financial position because of this development.

Indeed, it’s quite similar to another development in the payment of pensions to retirees. In some cases, pensions have been overpaying for decades, according to CNN Money. Now, some retirees owe tens of thousands of dollars that the pension funds want back.

This just goes to show that one of the best things you can do for yourself is understand how much you should be getting, and then match that up with your deposit. If you are overpaid, don’t think of it as unexpected good fortune; be prepared to pay it back.