A UI overpayment occurs when a claimant receives unemployment insurance benefits for a period of time for which he or she does not meet eligibility requirements. You must pay back overpaid unemployment benefits when the EDD determines that an error has been made. To help you repay over-issued unemployment insurance, the EDD will send you a letter explaining how much you owe and how to pay. Continue reading this page if you wish to find out about UI overpayment, and how to pay back overpaid unemployment benefits.
How do UI benefits overpayments occur?
A UI benefits overpayment occurs when you have been paid UI benefits during a time in which you were not eligible for them, or if you have been paid a higher amount of benefits than previously allotted. UI overpayment can happen if you did not complete your claim form properly, you did not provide all the necessary information or you have been receiving UI benefits while waiting for the result of an appeal hearing from UI denial. You must pay overpaid unemployment insurance benefits back to the state, no matter how small the amount.
If you received a UI benefits overpayment accidentally, you will have to pay the money back (in most all cases), but you will not incur a penalty or a fine. If, however, your UI benefits overpayment was made because you committed UI fraud, not only will you have to pay the money back, you will also face penalties and legal action. A UI overpayment due to fraud can lead to time in jail or prison. Download our free guide to read more about UI fraud and penalties.
What Happens After a UI Overpayment is Distributed?
If you have received a UI benefits overpayment, then the EDD will send you a letter of notification by mail. The letter will explain the details of your UI overpayment, including when you were overpaid and how much money you owe. It will also provide instructions on how to pay back overpaid unemployment benefits. If applicable to your case, the letter will also explain how you may appeal. It is vital that you complete and return all the requested forms and information. Your benefit payments may be reduced by a certain percentage until you have repaid the amount you owe.
Learn How to Pay Unemployment Overpayments
When it comes to paying back your UI benefits overpayment , you have a number of options. You can pay back overpaid unemployment benefits via phone by calling the EDD Benefit Overpayment Collection Section’s toll-free number. You can also repay overissued unemployment insurance online by visiting the Official Payments Corp. (OPC) website. (This website is not administered by the EDD.) Or, if you prefer, you may repay your UI benefits overpayment by mailing a check, a money order or a cashier’s check to the EDD Benefit Overpayment Collection Section. If you do not have the money to pay the full amount you owe, then you can call the EDD Benefit Overpayment Collection Section to discuss a payment plan option.
When you are getting ready to make your payment, you will need to have the following information nearby:
- The amount of money you owe, or the amount of the payment you are submitting
- Your Social Security Number
- Your contact information
- Your debit card or your credit card number
- Your credit card billing address details
To learn more about submitting your UI repayment, download our guide.
Can I appeal an overpaid unemployment insurance benefits claim?
If you do not agree with the decision of UI benefits overpayment, then you may appeal against the decision. If your UI benefits overpayment was made in error, you may wish to ask if all or some of the repayment can be waived. Typically, you will have to prove extreme financial hardship to receive a waiver. You will find instructions on how to appeal at the EDD website. You may make your appeal online, by mail, fax, in person or by phone.
Learn the Consequences of Not Repaying Over-issued Unemployment Insurance
If you do not pay back overpaid unemployment benefits on time, then the EDD can deduct the money you owe from your future weekly UI benefits payments. This process is called an “offset.” If you do not promptly repay overpaid unemployment insurance benefits, then the EDD can also reduce or completely withhold payments of your income tax refunds, lottery winnings or any other funds you are owed by the state of . To reclaim overpaid unemployment insurance benefits, the EDD may also file a claim against you in a court of law. If this happens, then you will also be responsible for paying court costs. If you are a property owner, the EDD may also place a lien on your home.
To learn more about how to repay overissued unemployment insurance, download our comprehensive guide.