§ 404(b) The regulations state in part: Sections 204(b) and 1870(c) of the Act provide that there shall be no adjustment or recovery in any case where an incorrect payment .
There is still the second prong, where repayment “would be against equity and good conscience.” However, this requires a “reliance to one’s detriment.” You may want to jump to examples which describe what this means in plain english.
Adjustment or recovery will defeat the purposes of title II in (but is not limited to) situations where the person from whom recovery is sought needs substantially all of his current income (including social security monthly benefits) to meet current ordinary and necessary living expenses.
So to review, if you need all of your current income (including SSA benefits) for ordinary and necessary living expenses, the repayment may be “defeat the purpose of the act.” Please note that Social Security does not list cell phone, cable, internet, eating out or going to movies as “ordinary and necessary living expenses.” If you are spending money on any of these, you probably have income beyond just “ordindary and necessary living expense” and the repayment may not “defeat the purpsose of the act.” But, if you meet this standard AND you are without fault for the overpayment, you may be able to win an overpayment case.
Although the Administration may have been at fault in making the overpayment, that fact does not relieve the overpaid individual or any other individual from whom the Administration seeks to recover the overpayment from liability for repayment if such individual is not without fault.
In reaching such a determination, the individual’s financial circumstances are irrelevant.
A widow, having been awarded benefits for herself and daughter, entered her daughter in private school because the monthly benefits made this possible.
Social Security Ruling 87-16c deals with the “defeat the purpose” portion.
This depends upon whether the person has an income or financial resources sufficient for more than ordinary and necessary needs, or is dependent upon all of his current benefits for such needs.