How to Repay Money for the Overpayment of Food Stamps

Overpayment of food stamps means that you spent or received more benefits than you should have received. Overpayment might occur because you made an error, you committed fraud or the Department of Social Services (DSS) made a mistake. Regardless of why the overpayment occurred, you should not ignore the issue, or you risk civil fines, criminal prosecution or wage garnishment.

Review the letter sent by the Special Investigations Division carefully. Contact the investigator and confirm the overpayment amount. Consider scheduling a Fair Hearing if you believe the amount reported to you is incorrect. You must dispute any allegations within 90 days, so don't ignore the notice and fail to take action in a timely manner. You'll also want to consider contacting a licensed attorney or a legal aid office if the overpayment amount is significant.

Should you agree with the overpayment amount, you'll need to establish a reasonable payment plan based on your current income to pay the agency back. You must discuss your income sources honestly with the investigator who is assigned to your case. Comply with the payment agreement. For example, if you owe $500, you might agree to pay $50 a month until it is paid off. You may be able to negotiate the exact amount you're comfortable paying toward the debt each month, which will help prevent a future hardship.

The state can recover the overpayment amount by deducting your current benefits. According to Pine Tree Legal Assistance, many agencies deduct either $10 or 10 percent of your monthly benefit amount until the debt is paid off. For example, if you receive $500 a month and owe $100, the government might take out $50 a month for two months.

Evaluate additional job opportunities. However, if you currently receive state or federal government assistance, such as unemployment or TANF, your benefits might be affected if your income increases significantly. The extra job would only need to be temporary until you finished paying off the debt.

Request a gift or a short-term loan from a family member, friend, religious group or non-profit organization if you are not able to physically take on another job. Another individual may be willing to pay the social services agency the amount due and then allow you to repay them for little to no interest.

Follow up with the investigator to confirm that the repayment agreement has been fulfilled. The government will not provide you with an attorney, even if you are indigent or poor, so you are responsible for reviewing your case.