Improvements to Rules on Recoupment of Benefit Overpayments

The Pension Benefit Guaranty Corporation, which insures pensioners when single-employer plans terminate, is simplifying how it recovers overpaid benefits. According to the Federal Register, the PBGC proposes a flat five percent recoupment rate — replacing more complex calculations — and is eliminating recoupment from surviving beneficiaries entirely. That means if a retiree accidentally received overpayments and later passed away, their heirs would keep those funds. For current beneficiaries, the change could ease the sting of discovering they owe money back — a sudden clawback that's now capped at five percent of their monthly benefit.

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