SSA says Grandmother owes 88K!

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Pocket Cruiser
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SSA says Grandmother owes 88K!

Post by Pocket Cruiser » Thu Mar 13, 2014 11:02 am

I don't have the whole story yet. I'm just posting this now to get some responses from ppl with similar experiences and how they solved them.

My grandmother recently received a letter from SSA claiming she was overpaid by $88,000. She was a teacher in texas and receives an annuity from that. She never received Ss until my grand father passed 6 years ago. After he passed, she went and talked to them about getting his survivor benefit, and they approved it. She has several letters from them stating that she is eligible and the amount of her benefit.

Did they make an error and just recently caught it? Is her benefit supposed to be reduced by her teacher retirement?

As an update, my grandmother did disclose her teacher pension when she filed for survivor benefit. She also has been sending a form yearly to Ssa to report cpi increases of the pension.

After she filed, she began receiving sporadic payments of varying amounts for a few years. After the 4th year, she received a letter stating she was entitled to backpay from the time of my grandfathers death for the full amount. She received the full benefit for 2 years, and received the overpayment letter this last Dec 13

She's had a couple of meetings, and so far, the option they gave her was to contact her representative.
Last edited by Pocket Cruiser on Mon Apr 14, 2014 12:02 pm, edited 3 times in total.

richard
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Re: SSA says Grandmother owes 88K!

Post by richard » Thu Mar 13, 2014 11:19 am

First google hit for "social security survivors benefits teacher pension texas" should help answer your question
http://www.atpe.org/advocacy/issues/socSec.asp

Texas hold em71
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Re: SSA says Grandmother owes 88K!

Post by Texas hold em71 » Thu Mar 13, 2014 11:22 am

It sounds like this:

Windfall Elimination Provision

http://www.ssa.gov/retire2/wep.htm

Other posters will have more direct experience with this, but this should get you started.

sscritic
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Re: SSA says Grandmother owes 88K!

Post by sscritic » Thu Mar 13, 2014 11:25 am

Texas hold em71 wrote:It sounds like this:

Windfall Elimination Provision

http://www.ssa.gov/retire2/wep.htm

Other posters will have more direct experience with this, but this should get you started.

No. Try GPO. She wasn't the worker, grandpa was.

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midareff
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Re: SSA says Grandmother owes 88K!

Post by midareff » Thu Mar 13, 2014 11:27 am

SSA sent me a letter that they wanted me to repay 2012 as I had made too much money. I had been told at my former work place they only report wages from actual work in my final year and adjusted my exit date to match the SSA's allowed maximum for my year of retirement. They misinformed me and in fact reported as wages payroll from used vacation, sick and holiday time, all of which I had much to burn before my final allowed lump sum payout. Nothing I could do about it so I am repaying it (used a 2% cash back AMEX) and they started my 2013 payment about 8% higher after cola adjustment. I've been advised that this years 1099 from the SSA will have only the net (2014 - repayment) so I may take some IRA money and back door it to Roth money before the end of the year to make use of that tax advantage.

The SSA allows 5 days for mail and then starts to take action 30 days from the date of the letter. I made an appointment (first available) to see them 3 days after I received the letter and they had already keyed to start deducts from future payments. In my case the mail took almost 15 days over the holidays and another 15 or 16 days for an appointment, so don't wait and get a face to face appointment scheduled right away. They seemed willing enough to work with you once you get to them.

sscritic
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Re: SSA says Grandmother owes 88K!

Post by sscritic » Thu Mar 13, 2014 11:32 am

There is no question that she was receiving her pension. Whether she failed to disclose it or they failed to ask is one issue, but it may not matter. The reduction is 2/3 of her pension.

Professor Emeritus
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Re: SSA says Grandmother owes 88K!

Post by Professor Emeritus » Thu Mar 13, 2014 12:15 pm

It is the pension benefit offset

http://www.ssa.gov/retire2/gpo.htm

In my experience Everyone getting a non SS pensions knows about this, argues about this and fights about it.

The simple fact is that the SS system is designed to provide benefits for non working spouses. But you get effectively nothing from Edited(the non working spouse benefit edited )if you are a two earner couple who are both in the system and the SS system prevents those outside the system from gaming it.

Edited to avoid the confusion noted below
Last edited by Professor Emeritus on Thu Mar 13, 2014 12:55 pm, edited 1 time in total.

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damjam
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Re: SSA says Grandmother owes 88K!

Post by damjam » Thu Mar 13, 2014 12:20 pm

Professor Emeritus wrote: But you get effectively nothing from if you are a two earner couple who are both in the system...

I'm not sure what you mean. Two earner couples who pay into SS certainly get benefits from SS. Don't we spend a lot of time on this board discussing proper claiming strategies for just such instances?

pshonore
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Re: SSA says Grandmother owes 88K!

Post by pshonore » Thu Mar 13, 2014 12:29 pm

I'd sure like to know how SS figured this out. What kind of "data review" does SS perform. For example, I would think if you're less than FRA and collecting SS, they may want to match any W2 or Sched C, K1 (partnership) from tax records to see if you're over the earnings limit. Do they review 1099R forms if you're collecting a spousal or survivor benefit to see if you're getting a gov't pension. Seems doubtful.

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Re: SSA says Grandmother owes 88K!

Post by Rupert » Thu Mar 13, 2014 12:50 pm

pshonore wrote:I'd sure like to know how SS figured this out. What kind of "data review" does SS perform. For example, I would think if you're less than FRA and collecting SS, they may want to match any W2 or Sched C, K1 (partnership) from tax records to see if you're over the earnings limit. Do they review 1099R forms if you're collecting a spousal or survivor benefit to see if you're getting a gov't pension. Seems doubtful.


Here's the info that the IRS says it shares with SSA:

IRC 6103(l)(1)provides that return information related to taxes imposed under chapters 2, 21, and 24 may be disclosed to the Social Security Administration (SSA) as needed to carry out its responsibilities under the Social Security Act. Chapter 2 relates to self-employment income and does not normally concern employers. Chapter 21 concerns social security and Medicare (FICA) tax, and chapter 24 deals with income tax withholding.

The IRS may therefore share information with SSA about social security and Medicare tax liability if necessary to establish the taxpayer’s liability. This provision does not allow the IRS to disclose your tax information to SSA for any other reason. SSA employees who receive this information are bound by the same confidentiality rules as IRS employees. Therefore, they generally cannot disclose the information to state social security administrators, state officials or other Federal agencies.

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Re: SSA says Grandmother owes 88K!

Post by Professor Emeritus » Thu Mar 13, 2014 12:51 pm

damjam wrote:
Professor Emeritus wrote: But you get effectively nothing from if you are a two earner couple who are both in the system...

I'm not sure what you mean. Two earner couples who pay into SS certainly get benefits from SS. Don't we spend a lot of time on this board discussing proper claiming strategies for just such instances?


You get very little in spousal benefit. yes if you are very careful one of you can wring out a few years. I have edited the comment above to correct the implication.
Last edited by Professor Emeritus on Thu Mar 13, 2014 12:55 pm, edited 1 time in total.

manwithnoname
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Re: SSA says Grandmother owes 88K!

Post by manwithnoname » Thu Mar 13, 2014 12:52 pm

aws316 wrote:I don't have the whole story yet. I'm just posting this now to get some responses from ppl with similar experiences and how they solved them.

My grandmother recently received a letter from SSA claiming she was overpaid by $88,000. She was a teacher in texas and receives an annuity from that. She never received Ss until my grand father passed 5 years ago. After he passed, she went and talked to them about getting his survivor benefit, and they approved it. She has several letters from them stating that she is eligible and the amount of her benefit.

Did they make an error and just recently caught it? Is her benefit supposed to be reduced by her teacher retirement?


Looks like the GPO was not calculated when her SS benefits commenced.

Your grandmother has two options:

1. retain an attorney who handles elder law/ SS benefits matters to investigate.

2. Contact her congressperson and ask them to investigate how this mess happened. If she is an innocent party and SS made a mistake in not offsetting for the GPO 5 years ago then there may be some way to mitigate the overpayments especially if repayment would be a financial hardship.

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Re: SSA says Grandmother owes 88K!

Post by Pocket Cruiser » Thu Mar 13, 2014 2:24 pm

Thanks everyone for the help. I will follow up when I know more.

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frugaltype
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Re: SSA says Grandmother owes 88K!

Post by frugaltype » Thu Mar 13, 2014 2:49 pm

I don't know if this is pertinent, but apparently if SS underpays, you lose in terms of getting that fixed.

I forget the exact details, but something like this happened: My Mom was getting SS based on my deceased Dad's history, because it was a greater benefit than she qualified for based on her history. She continued working. After some years, she belatedly realized that her continuing work had made her benefit based on her history greater than the one she'd been getting based on my Dad's for several years. Tough luck, Mom. She was never able to get the difference.

Now, in a just world, if they don't reimburse for underpayments, they shouldn't charge for overpayments...

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Re: SSA says Grandmother owes 88K!

Post by sscritic » Thu Mar 13, 2014 3:06 pm

You have to file for what you want. If you don't file, they won't pay you. The "never" statement doesn't seem right. The never applies to the past, not to the future.

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Re: SSA says Grandmother owes 88K!

Post by JonnyDVM » Thu Mar 13, 2014 3:30 pm

frugaltype wrote:
Now, in a just world, if they don't reimburse for underpayments, they shouldn't charge for overpayments...


They should fix both errors, not just ignore both.
Sometimes the questions are complicated and the answers are simple. -Dr. Seuss

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dm200
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Re: SSA says Grandmother owes 88K!

Post by dm200 » Thu Mar 13, 2014 3:34 pm

The answer may be (probably is) in the details of her filing for the SS benefits after her husband's death - but it may very well be that, almost certainly unintentinal on her part, she did not propoerly disclose the details of her employment that was not subject to Social Security taxes and benefits.

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Re: SSA says Grandmother owes 88K!

Post by Pocket Cruiser » Mon Apr 14, 2014 10:08 am

I posted an update to my original posting. It didn't bump the post. If there a way to bump a message without having to post?

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House Blend
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Re: SSA says Grandmother owes 88K!

Post by House Blend » Mon Apr 14, 2014 11:29 am

PC,

I do hope you get this cleared up. The latest innovation at the IRS and SSA is that they can go after the children (or any relatives) to retrieve any overpayments to deceased parents, and they can seize your tax refunds to pay down this debt.

Article: http://www.washingtonpost.com/politics/social-security-treasury-target-hundreds-of-thousands-of-taxpayers-for-parents-old-debts/2014/04/10/74ac8eae-bf4d-11e3-bcec-b71ee10e9bc3_story.html

Probably this article deserves its own thread, but it could easily get locked.
At least here it is directly relevant to your situation.

lululu
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Re: SSA says Grandmother owes 88K!

Post by lululu » Mon Apr 14, 2014 11:44 am

House Blend wrote:PC,

I do hope you get this cleared up. The latest innovation at the IRS and SSA is that they can go after the children (or any relatives) to retrieve any overpayments to deceased parents, and they can seize your tax refunds to pay down this debt.

Article: http://www.washingtonpost.com/politics/social-security-treasury-target-hundreds-of-thousands-of-taxpayers-for-parents-old-debts/2014/04/10/74ac8eae-bf4d-11e3-bcec-b71ee10e9bc3_story.html

Probably this article deserves its own thread, but it could easily get locked.
At least here it is directly relevant to your situation.


I just read that article. Whoever implemented this is certifiably crazy. Never mind the question of being responsible for someone else's debts, who has records for their parents who died decades ago. Due process isn't even on the same planet as this.

Normally I would say, get the help of the congressional representative's office, but in my experience those people have no clout with Social Security errors. Legislation is needed for this.

paulsiu
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Re: SSA says Grandmother owes 88K!

Post by paulsiu » Mon Apr 14, 2014 12:13 pm

Make sure you respond to SS in a timely manner, they often give you a limited time window for appeal and afterwards it's virtually impossible to fix.

Paul

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Re: SSA says Grandmother owes 88K!

Post by SimonJester » Mon Apr 14, 2014 1:45 pm

House Blend wrote:PC,
I do hope you get this cleared up. The latest innovation at the IRS and SSA is that they can go after the children (or any relatives) to retrieve any overpayments to deceased parents, and they can seize your tax refunds to pay down this debt.

Article: http://www.washingtonpost.com/politics/social-security-treasury-target-hundreds-of-thousands-of-taxpayers-for-parents-old-debts/2014/04/10/74ac8eae-bf4d-11e3-bcec-b71ee10e9bc3_story.html

Probably this article deserves its own thread, but it could easily get locked.
At least here it is directly relevant to your situation.



Wow this is just sickening beyond belief. They should be held to the same statue of limitations as normal creditors.

Even more of a reason to never have a refund due to you...

Perhaps I should ask my mother if my Great Great Great Grand mother was overpaid on her civil war pension.
Last edited by SimonJester on Mon Apr 14, 2014 4:10 pm, edited 1 time in total.
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22twain
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Re: SSA says Grandmother owes 88K!

Post by 22twain » Mon Apr 14, 2014 3:21 pm

SimonJester wrote:Perhaps I should ask my mother if my Great Great Grand mother was overpaid on her civil war pension.


If your great-great-grandfather was on the losing side, just pay it back in Confederate dollars. :mrgreen:

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Re: SSA says Grandmother owes 88K!

Post by ResearchMed » Mon Apr 14, 2014 5:58 pm

House Blend wrote:PC,

I do hope you get this cleared up. The latest innovation at the IRS and SSA is that they can go after the children (or any relatives) to retrieve any overpayments to deceased parents, and they can seize your tax refunds to pay down this debt.

Article: http://www.washingtonpost.com/politics/social-security-treasury-target-hundreds-of-thousands-of-taxpayers-for-parents-old-debts/2014/04/10/74ac8eae-bf4d-11e3-bcec-b71ee10e9bc3_story.html

Probably this article deserves its own thread, but it could easily get locked.
At least here it is directly relevant to your situation.


Apparently some of this is being changed:

FROM http://www.cnbc.com/id/101582573

"Social Security halts effort to collect old debts
The Social Security Administration is suspending a program in which thousands of people were having their tax refunds seized to recoup overpayments that happened more than a decade ago. .....
"

The story continues that included in the "halt" are the efforts to collect from children for payments made years ago to parents.
Perhaps this will STOP what is happening to your Grandmother, but I'm not sure if her situation is included in all of this.

RM

sscritic
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Re: SSA says Grandmother owes 88K!

Post by sscritic » Mon Apr 14, 2014 6:11 pm

It's not, as I understand it.

1) person overpaid. attempt made to recover overpayment from the person overpaid.
2) minor person overpaid. attempt made to recover overpayment from the person overpaid (now an adult).
3) person overpaid. attempt made to recover payment from the child of person overpaid.

While my personal opinion is that 2 and 3 are not the same, my understanding is that both will be off the hook with respect to returning the overpayment. Scenario 1 is different than 2 in that the person was not a minor at the time. In 2, an adult took money that was overpaid to a child and spent it.

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Re: SSA says Grandmother owes 88K!

Post by TimeRunner » Mon Apr 14, 2014 6:15 pm

Almost as silly as: "My Mom forgot to turn in a library book of bedtime stories she used to read out loud to me. Now the library system wants me to pay for the book, with interest, since I benefitted from the stories, and I'm the oldest of her children."
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Re: SSA says Grandmother owes 88K!

Post by sscritic » Mon Apr 14, 2014 6:35 pm

TimeRunner wrote:Almost as silly as: "My Mom forgot to turn in a library book of bedtime stories she used to read out loud to me. Now the library system wants me to pay for the book, with interest, since I benefitted from the stories, and I'm the oldest of her children."

What if you checked out the book with your own library card? Are you still going to pin the rap on mom? I would. That's my story, and I'm stickin' to it. My mom did it!

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Re: SSA says Grandmother owes 88K!

Post by Pocket Cruiser » Sat Aug 23, 2014 12:06 am

Thanks everyone for the info and links.

Grandma has been back and forth with the local SSA for the past few months. They have admitted that it was an error on their part, but no one wants to be the "one" to make the decision that the over payment can be waived. It is now going before a judge who has up to 6 months to make a decision.

They initially wanted her to provide evidence that it would be a financial hardship for her to repay the 88K! :oops:

She brought them 5 shoe boxes packed with receipts spanning the entire time she received SS ~6 years. :D There are a few benefits of hoarding!

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