What happens when you receive excess unemployment benefits or your claim is denied and you are asked to repay the money you received? An overpayment occurs when you receive unemployment benefits that you were not eligible for.
Unemployment Benefits Overpayment
There are many reasons that can lead to the cancellation of a social security claim. You may have received overpayments due to an error or because you claimed benefits that you were not entitled to receive. For example, some reasons that may lead to an overpayment include:
- You com
- You were not able and available for work
- You did not complete the required job search activities
- You provided false or misleading information when filing the claim or submitting weekly benefits
Another reason may be that your previous employer successfully challenged your unemployment claim because they did not believe you were eligible to collect benefits. If this is the case, the state may have determined that you are not eligible for benefits. In most cases, you will be required to repay the excess unemployment benefits that were paid.
Overpayment Notice
The state’s unemployment office will notify you (usually by mail) if you have been overpaid. The notice will explain the reason for the overpayment notice, how much is owed, any penalties (if applicable), and information on how to appeal, as well as instructions on repaying the overpaid amount.
How is the overpayment repaid?
In most cases, you will be required to repay the overpaid amount. You may be asked to send a check to pay off the overpayment balance. If you cannot repay the full amount at once, you may be able to negotiate a repayment plan.
Otherwise, if you are entitled to additional benefits, you may be able to use those benefits to repay the overpayment.
Loss of Future Benefits
In some states, you will lose days or weeks of unemployment benefits to offset what you owe. For example, in New York, you will lose 25% of your benefits for that week for each day of overpayment, so if you have four days of overpayment, you will not receive any benefits for that week.
If you cannot reach a sufficient repayment agreement, the owed amount may be deducted from your wages (if you are working), or from lottery winnings, or from federal and state tax refunds.
Note: If the overpayment was due to fraud, you may be subject to a penalty and possibly charged with criminal fraud. You may also be banned from collecting future unemployment benefits.
Appeals and Waivers
Request for Waiver
If you believe the notice is inaccurate, you can dispute the decision. If you were overpaid due to an error, you may be able to request a waiver to avoid repaying all or some of the benefits you received in error. In most cases, you will need to demonstrate financial hardship to obtain a waiver or to negotiate a repayment plan.
Filing an Appeal
In most states, you have the right to a hearing to review your appeal. The hearing is an informal proceeding held before an administrative law judge. Based on the evidence presented at the hearing, the judge will decide whether you were eligible for unemployment insurance benefits or not.
At the hearing, you and your former employer and any witnesses for either side can testify. The testimony will be recorded. Any party may also submit documents or other physical evidence.
Reviewing the Process
Instructions for appealing will be listed on your state’s unemployment website. You may be able to file an appeal online, by fax, by mail, in person, or by phone.
Check State Law
State unemployment laws contain general and specific information for each state regarding unemployment overpayment and compensation and benefits. Contact your state’s unemployment office to determine your specific circumstances and clarify how to handle overpayment in your state. Remember that state laws vary.
Questions
Frequently Asked Questions (FAQs)
Am I required to repay an overpayment of unemployment benefits?
You are legally obligated to repay the amount you were overpaid in unemployment benefits. If your appeal is denied or your waiver request is rejected, you will need to pay the overpayment amount to your state’s unemployment office.
Are there penalties for overpayment of unemployment benefits?
If you provided false information or withheld information to receive unemployment benefits, you may face a fine from your state’s unemployment office. You could also be charged with fraud.
Sources
The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts in our articles. Read our editorial process to learn more about how we verify facts and maintain the accuracy, reliability, and credibility of our content.
New York State Department of Labor. “Overpayments and Penalties.”
U.S. Department of Labor. “Waivers for Unemployment Insurance Overpayments.”
U.S. Department of Labor. “Denial of Benefits.”
Source: https://www.thebalancemoney.com/repaying-an-overpayment-of-unemployment-benefits-2064188
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