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  • It is the making of fantasies or of nightmares, depending on your personality. You go to check your battered bank balance and notice there has been a $600 payment from the Pennsylvania Department of Labor and Industry you were not expecting. In fact, on closer inspection you realize it is a mistake, you have been overpaid. This, of course, is not only a figment of my imagination, it happens often enough. After all, the Pennsylvania Unemployment Compensation program has to deal with thousands of claims, a mistake here and there is to be expected.

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    The big question is what are you going to do? The issue of government overpayment of benefits seems to be view on a moral par to finding money on the street. Nobody seems to be a victim of this overpayment, unless you count all taxpayers, so is it really that bad to keep it and keep quiet. The moral dilemma seems to be pretty straightforward: it isn’t your money and our near-bankrupt unemployment compensation program can’t afford to give out bonuses. But the question many of our reader have been asking is: what if I don’t pay it back?

    That was the question posed by one of our readers: “What If I do not pay back an overpayment? What can happen to me?

    There are three types of overpayments. One of them you don’t have to pay back.

     Fault overpayments occur when you receive more benefits than you should because you provide misleading information to the unemployment compensation program, in other words, because you lie. Not surprisingly, you must repay fault overpayments. If you don’t pay it within 15 days of being notified, you will start to owe interest on the overpayment. If you insist on not paying, a lien may be placed on your wages, if you are back to work, or on your benefits. In addition to this, the Pennsylvania Unemployment Compensation law allows the for the conviction of people who provide false statement or who knowingly withhold information to obtain or increase their benefits. If found guilty, you could be fined up to $1,000 or spend up to 30 days in prison, or both if you are really lucky. Further, you will be required to repay any benefits you were not entitled to.

    Non-fault overpayments occur when the Pennsylvania unemployment compensation program pays you more than they should through no fault of your own. These must also be repaid. However, you have two options: to repay it voluntarily through a check or money order, or to get it discounted from any future benefits during the next three-year period. These deductions cannot exceed a third of your weekly benefits, although if the overpayment is less than $100 it will be deducted in full the first week.

    Non-fault non-recoupable overpayments occur when you are overpaid because the unemployment compensation program changes its mind on your eligibility, determines the wages you earned do not meet the definition of employment or you receive holiday and vacations pay you did not know about. In these cases, you do not have to repay the overpayment and they wont be deducted from any future benefits. However, the unemployment compensation program will accept voluntary repayments.

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