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Benefit Overpayments

An overpayment is money that is paid beyond what a claimant's unemployment benefits are due. A Notice of Overpayment is mailed to you when you have been paid unemployment benefits that you were not eligible to receive. The notice shows the amount of the overpayment and penalties, if any. It explains why you were overpaid and gives you information about your appeal rights.

How Overpayments Occur

Overpayments often occur when false (or missing) information is submitted during an unemployment claimant's weekly certification. There are several instances in which an overpayment in benefits is created. One a regular basis, we cross-match a claimant's unemployment benefit payments with employer wage data to detect if an overpayment may have occurred.

Improper Wage Reporting

During a claimant's weekly certification, a question asks how much money was earned last week. If the gross amount of wages earned are not entered (even if they have not yet been paid), this could result in an overpayment.

Failure to Report your "Return to Work" dates

When drawing unemployment, any new employment (and separations) should be reported during your certification.

"Have you taken a job and were laid off, quit or discharged since your last claim was filed?"

Even if you take a new job for just one day, technically you are now re-employed. If you decide to quit that job the next day, you must answer this certification question as "YES" which means you may not be eligible for unemployment benefits since you quit that job.

An Employer's Appeal

If an employer contests the decision for your benefits and wins the appeal, this could result in an overpayment. Since the appeals process may take several weeks, the benefits you were paid would need to be returned to our UI Recovery Unit. 

Types of Overpayments

Whether the overpayment is created due to an abuse of the system or from a lack of attention to certification requirements, we classify overpayments into two categories: non-fraud or fraud.

Non-Fraud: When you have received benefits to which you were not entitled and you are not at fault, the overpayment is considered non-fraud. In most cases, you are responsible for repay non-fraud overpayments. Only cases of hardship may be considered to be waived.

Fraud: A fraud overpayment occurs when you knowingly give false information or withhold information and as a result receive benefits that you should not have received. Withholding or giving false information to obtain unemployment insurance benefits is a serious offense that can result in criminal prosecution. Fraud overpayments and penalties must be repaid.

Setup a Repayment Plan

The UI Recovery Unit can establish a repayment plan in the event of an overpayment occurring. If the UI Recovery Unit cannot establish the repayment plan with you, the agency will be authorized to collect any unemployment compensation debt from any federal income tax refund or through the garnishment process.

A fraud decision will not allow payment of unemployment insurance benefits until the disqualification period is over and the overpayment and penalties are paid in full.

If you have received a Notice of Overpayment, establish a repayment plan by calling 844-817-0619.

Payments may be made by check or money order and mailed to UI Recovery Unit.

UI Recovery Unit
PO Box 24150
Nashville, TN 
37202-4150