Social Security Snafus—and How to Fix Them

By Elaine Floyd, CFP ®

First let it be said that for the number of people served (73 million) and the amount of money paid out annually ($1.5 trillion), the Social Security Administration does an admirable job of keeping everything straight. More than 99% of beneficiaries receive their benefits on time and in the correct amount and never need to contact SSA for any reason other than to report changes in marital status, home address, bank account, or other pertinent details. But SSA’s error rate is not zero, and if you’re one of the ones who gets caught in an administrative snafu, it doesn’t matter that almost everyone else is getting their checks on time. Here are some common SSA snafus and how to fix them.

Earnings record errors

Earnings are reported to SSA via W-2 and are usually accurate. But errors can occur, usually due to mistakes in the Social Security number or the earnings amount. Errors are more common among self-employed individuals, who report their earnings via their tax return. If an extension was filed or a tax return was amended, the information may not make its way over to SSA from the IRS causing earnings not to be reported at all.

Clients should regularly check their earnings records and verify against W-2s or paystubs or tax returns. If an error is discovered they can correct it by calling SSA at (800) 772-1213 or by completing Form SSA-7008 and mailing or delivering it to a local office. Allow up to 120 days for the correction to be completed and follow up in writing.

Overpayments

Overpayments arise when a person receives benefits they were not entitled to. The fault may lie with SSA, but more often it’s because the beneficiary failed to report employment or marital changes. When an overpayment is discovered, the beneficiary receives a notice demanding repayment. Even if the overpayment is SSA’s fault, the funds must be paid back, either in a lump sum or through the withholding of future benefits.

If the client believes the overpayment did not occur or the amount is incorrect, they can dispute it by submitting Form SSA-561-U2 (Request for Reconsideration). Or, if they were not at fault and the repayment would cause financial hardship, they can submit a waiver via Form SSA-632-BK. Or, if they do not dispute the overpayment but can’t afford to repay it, they can request a reduced rate by filing Form SSA-634 (Request for Change in Overpayment Recovery Rate). Filing an appeal or waiver stops collection until SSA issues its decision. If the appeal is denied, the client may request a hearing before an Administrative Law Judge within 60 days.

 

Underpayments and widow’s benefit miscalculations

Some widows receive lower benefits because they were not informed of their right to switch from their survivor benefit to their own retirement benefit or vice versa. In other cases, the survivor benefit was miscalculated by SSA. When a spouse dies before age 62, SSA is supposed to calculate a “WINDEX PIA” which substitutes a later year (usually the year the survivor turns 60) for indexing purposes. This WINDEX PIA will be used if it results in a higher amount.

Widows who question the amount of their survivor benefit can call SSA at (800) 772-1213 and request a full review of their survivor benefit calculation. Specifically, they can ask if a WINDEX PIA was applied to their benefit calculation. If they were underpaid, SSA must issue a retroactive lump sum payment and/or increase future benefits.

 

Being listed as deceased

When SSA lists a person as deceased, benefits stop immediately. Direct deposits are halted, Medicare is suspended, and bank accounts may even be frozen. If the death listing is erroneous and the person is still alive, the resolution process can be “prolonged and arduous,” according to SSA’s own March 2025 statement.

Needless to say, the fix is to convince SSA you are still alive.

• Call SSA immediately (800) 772-1213 and state that you are a living beneficiary whose benefits have been suspended.
• Visit your local Social Security field office in person with a government-issued photo ID (passport, driver’s license).
• Bring: birth certificate, SSN card, any other government-issued document confirming identity.
• Request that SSA correct the Numident record and reactivate your benefits.
• Ask SSA to issue all retroactive payments for months benefits were wrongly withheld.
• If not resolved within 10 business days, contact your U.S. Congressional representative’s office for constituent services assistance—this frequently accelerates resolution.
• File a complaint with the SSA Office of the Inspector General at oig.ssa.gov if the response remains inadequate.

Marriage and remarriage benefit miscalculations

SSA does not know about a marriage or remarriage until the individual self-reports it. Failure to report a marriage or remarriage can result in either overpayments or underpayments depending on the situation. For example, if an individual receiving divorced-spouse benefits remarries, the divorced-spouse benefit must stop. If the remarriage isn’t reported and the divorced-spouse benefits continue, they will be considered an overpayment (which may be partially offset by entitlement to spousal benefits off the new spouse). Remarriage after age 60 does not halt the payment of survivor benefits (or divorced-spouse survivor benefits), but benefits could be erroneously stopped by SSA when the remarriage is reported.

To fix or prevent, report all marital events and check on benefits going forward.

• Report a marriage or divorce within 10 days of the event.
• At remarriage, ask SSA specifically about the impact on all active benefit streams.
• For survivor beneficiaries remarrying at 60+: confirm survivor benefits continue.
• Request written confirmation of any benefit changes in your file.
• If an overpayment results from SSA’s failure to update records after you reported: file SSA-561-U2 (dispute) or SSA-632-BK (waiver—you were not at fault).

Wrongful benefit suspensions or terminations

A common reason for benefit suspensions is the earnings test. We’ve talked about this before: clients under FRA who are still working will file for benefits, maybe knowing there will be some withholding for the earnings test but not understanding what a huge administrative hassle it will be and the near impossibility of verifying the accuracy of the withheld amount (and, later, the recalculation of their benefit at FRA). Nevertheless, some clients are determined to start their benefit early, and all you can do is prepare them for frequent back-and-forth communications with SSA and the importance of accurately estimating their earnings. Part of the problem with the earnings test is the lag time between the client’s estimate and the actual reporting of the earnings. SSA withholds benefits right away based on the client’s estimate, and later, after earnings are reported, makes the necessary adjustments due to the (almost certain) discrepancy between estimated and actual earnings. At the same time it is making this adjustment it is also withholding benefits based on estimated future earnings, which, in turn, will need to be adjusted after those earnings are reported. It can be a mess.

 

Source: Horsesmouth