FAQs - Benefit Overpayments

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General

A benefit overpayment is when you receive an Unemployment Insurance (UI), Disability Insurance (DI), or Paid Family Leave (PFL) benefit you are not eligible for.

The overpayment debt amount may include an additional 30 percent penalty if the overpayment was due to fraud. You must repay an overpayment to avoid collection and possible legal action.

To prevent an overpayment, you must immediately contact the EDD if you:

  • Returned to part-time or full-time work.
  • Have recovered from your disability.
  • Stopped your Paid Family Leave care or bonding benefit before using the full six weeks.
  • Received wages from your employer.
  • Need to report a date of death for a deceased claimant.

Additionally, if you are receiving Disability Insurance benefits, ensure your employer promptly returns the Notice to Employer of Disability Insurance (DI) Claim Filed (DE 2503) or Notice to Employer of Paid Family Leave (PFL) Claim Filed (DE 2503F). Also, if you recover from an illness/injury or return to work, you need to return the Notice of Automatic Payment (DE 2587) or Notice of Automatic Payment – PFL (DE 2587F) form to the EDD.

You will receive a Notice of Potential Overpayment (DE 1447D/DE 1447F) or Notice of Overpayment (DE 4400/DE 4400F) by mail if you received Disability Insurance or Paid Family Leave benefits that you were not eligible for. The notice shows the overpayment amount and penalties, if any. In addition, the notice explains why you were overpaid and provides information about your appeal rights.

You will receive a Notice of Potential Overpayment (DE 1447CO-AZ) and Response to Potential Overpayment (DE 1447CO-BZ) by mail if you received Unemployment Insurance benefits that you were not eligible for. The notice shows the overpayment amount and penalties, if any. In addition, the notice explains why you were overpaid.

You will receive a Notice of Overpayment (DE 1444) or Notice of Denial of Benefits and Overpayment (DE 1480Z) by mail if you received Unemployment Insurance benefits that you were not eligible for. The notice shows the overpayment amount and penalties, if any. In addition, the notice explains why you were overpaid and provides information about your appeal rights.

The EDD generally classifies overpayments into two categories: fraud or non-fraud.

Fraud: If the EDD finds that you intentionally gave false information or withheld information and, as a result, received benefits that you should not have received, the overpayment is considered fraud. Withholding or giving false information to obtain benefits is a serious offense that can result in penalties and criminal prosecution. With a fraud overpayment, you can receive a penalty equal to 30 percent of the overpayment amount. Additionally, you can be disqualified for 5 to 23 weeks. You must repay fraud overpayments and penalties.

Non-Fraud: If you received benefits you were not eligible for and the overpayment was not your fault, the overpayment is considered non-fraud. You will receive a notice telling you if the overpayment must be repaid.

Make a Payment

Visit Benefit Overpayment Services to log in or make a payment. Options for payment are:

  • Online with Benefit Overpayment Services or Make a Payment:
    • Benefit Overpayment Services: Log in to view your balance, make a payment, or set up an installment agreement.
    • Make a Payment: Pay with Automated Clearing House (ACH) debit (no fee) or by credit card (fee applies). No enrollment necessary.
  • By phone with a credit card through Official Payments Corporation (fee applies).
  • By mail using a personal check, cashier’s check, or money order (no fee).

Credit card payments are completed through Official Payments Corporation (OPC) and there is a 2.3 percent convenience fee. The following credit cards are accepted: Visa, Mastercard, Discover Network, and American Express.

Visit Official Payments Corporation to make a payment.

  • Select State Payments.
  • Enter jurisdiction code 1577.
  • Select Make a Payment.
  • Select Payment Type Benefit Overpayment.
  • Select Make a Payment and complete the required fields.

The EDD is not responsible for the contents of OPC’s website or any links on its website. The EDD recommends that you review OPC’s security and confidentiality statements.

If you need more information on paying your benefit overpayment by credit card, visit FAQs – Benefit Overpayment Credit Card Payments.

Log in to Benefit Overpayment Services or call the Benefit Overpayment Collection Section at 1-800-676-5737 to request an installment agreement.

Benefit Offset

If you do not repay your overpayment, the EDD will deduct the money owed from your future Unemployment Insurance or State Disability Insurance (SDI) benefits. This process is called a benefit offset. For non-fraud overpayments, the EDD will offset 25 percent of your weekly benefit payments. For fraud overpayments, the EDD will offset 100 percent of your weekly benefit payments. Since the EDD cannot offset the penalty portion of an overpayment from your benefits, you must repay the penalty separately.

If the EDD offsets your weekly SDI benefit payments to repay a Disability Insurance or Paid Family Leave overpayment, you will receive a Notice of Overpayment Offset (DE 826).

Federal/State Income Tax Offset

If you were overpaid and are owed a state and/or federal income tax refund, the EDD will take the overpayment from the refund per section 12419.5 of the California Government Code.

For more information, visit Your Tax Refund or Lottery Money Was Sent to the EDD.

You must complete the Injured Spouse Allocation (IRS Form 8379) and send it to the IRS for review. You can download IRS Form 8379 (PDF), call the IRS at 1-800-829-3676, or visit a local IRS office. Contact the IRS if you have questions about the form.

Yes, if you pay your debt in full before your taxes are offset.

Allow four weeks for your offset to be applied.

Unclaimed Property and/or Lottery Winnings Offset

If you are owed unclaimed property or lottery winnings, and have not completely repaid your overpayment, the EDD will collect any remaining amount owed from your refund or winnings, per section 12419.5 of the Government Code.

For more information, visit Your Tax Refund or Lottery Money Was Sent to the EDD.

Legal Action

The EDD may take legal action, such as:

  • Filing of a summary judgment.
  • Recording of a lien on real or personal property.
  • Serving a wage garnishment.
  • An accounts receivable levy and/or bank levy.

A summary judgment is a civil action filed with the superior court against the liable person for the recovery of Unemployment Insurance or Disability Insurance benefit overpayment debt, pursuant to sections 1379 and 2739 of the California Unemployment Insurance Code.

A lien is the legal claim of one person on the property of another person to secure the payment of a debt or the satisfaction of an obligation. It is the recording of an Abstract of Judgment with the County Recorder’s Office which places a legal claim on real and personal property. To release the lien, the balance of the overpayment amount, including any filing fees and interest accrued, will need to be paid in full.

When refinancing or selling property, you must have all liens cleared. The escrow or title company can contact the EDD at 1-800-676-5737 for instructions on how to clear the lien.

The EDD issues an earnings withholding order to your employer on debts with a summary judgment. Your employer may garnish up to 25 percent of your wages to submit to the EDD to comply with the order. You can pay the debt in full to avoid the wage garnishment.

Additional Resources

If you need more information or would like to update your contact information, visit Ask EDD and select the category Benefit Overpayment Collections.