Information Center

Limitations on Recovery of Overpayments

01/13/11
Bill
Request for Information

The Restoring Pension Promises to Workers Act of 2007 would impose limitations on a pension plan’s ability to collect money from pension recipients for overpayments.

Under current law, if a pension plan discovers that it made a mistake in a retiree’s pension benefit, the plan can recover the amount of the overpayment regardless of whether the retiree will incur a financial hardship.

The bill would prohibit a recovery by a plan in situations where it would cause a financial hardship to the retiree or where the amount involved is insignificant in relation to the plan’s overall assets and liabilities. The bill also provides that plans would only be able to recover overpayments made within three years prior to the discovery of the overpayment. Finally, the bill would require plans to notify retirees and any eligible beneficiaries of the right to appeal a decision to recover overpayments.

Read section 102 of the Restoring Pension Promises to Workers Act of 2007 [PDF]

 

< Back

Sign up to receive updates from us:

Do you want to stay up to date on the latest retirement news and recent happenings at PRC?

Sign up to receive emails from us:

Click here >

Support the Pension Rights Center:

In today’s challenging pension environment, our work is more important than ever. Your contribution will help make it possible for the Center to continue its crucial role as a national consumer organization committed to protecting and promoting retirement security.

Donate >