Jesse Jones

Social security overpayments have some in Washington scrambling to pay back thousands

Last week we told you about the Social Security Administration overpaying recipients a total of $21 billion nationally.

Now the government wants its money back and families across the country are saying they can’t come up with the cash. KIRO 7′s Jesse Jones investigated how this issue is impacting the most vulnerable families.

When Lori Cochran received the alarming letter from the Social Security Administration notifying her she owed $27k, she was in shock.

“When I was reading it for the first time, I was having heart palpitations because I was like oh my gosh, $27,000? They’re going to expect me to pay that back?”

Miranda Thorpe felt equally blind-sided, My daughter is 26. She was born with a genetic condition that’s very rare that causes her to have a developmental delay as well as epilepsy.”

Miranda said her daughter went over the federal savings limit of two thousand dollars for a few months in 2020.

That’s right Miranda is only entitled to keep two $2,000 in Sarena’s bank accounts.

Think of it this way, according to Zillow the average rent in the Seattle market is $2,245.

“I think it’s a punitive process. I don’t think it’s fair and I don’t think that they really cared,” said Miranda.

These families have one thing in common, they are part of the $21 billion in overpayments from the Social Security Administration.

The agency is now clawing back $4 to $5 billion of the funds annually from families like the Thorpes. Records show the majority of overpayments are from supplemental security income, or SSI, basically retirement-aged, low-income, and/or disabled people who exceeded asset or income limits.

Rebecca Vallas, an advocate for the disabled and attorney for the Century Foundation, says the agency knows full well that recipients don’t have a pile of cash that they’re sitting on.

“The reality is you can do everything right and still get hit by a massive overpayment from Social Security,” said Vallas.

Families receiving SSI benefits said raising paltry asset limits would be life-changing. Currently, individual beneficiaries can have no more than $2k in their bank accounts. While married couples just $3k. However, a bill reintroduced into the US Senate would change that.

It is called the SSI Savings Penalty Elimination Act. The bill would increase limits to $10k for individuals and $20k for married couples.

Ohio Sen. Sherrod Brown said it’s time to update these limits, “This law hasn’t been changed for 40 years.”

Miranda believes passage of the bill is crucial. So, all families have a fighting chance to stay strong should an economic crisis hit.

“Absolutely. I don’t see any downside of this. These are people that need our help the most. So, I don’t see why punishing them or keeping them impoverished does anything for our society,” said Miranda.

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