Dollar General CEO Todd Vasos said on Thursday that inflation continues to hurt the discounter’s customers and that the macroeconomic environment won’t improve this year.

On the company’s fourth-quarter earnings call, Vasos said customers are expecting value and convenience “more than ever” from the dollar-store chain.

“Our customers continue to report that their financial situation has worsened over the last year, as they have been negatively impacted by ongoing inflation. Many of our customers report they only have enough money for basic essentials, with some noting that they have had to sacrifice even on the necessities,” Vasos said. “As we enter 2025, we are not anticipating improvement in the macro environment, particularly for our core customer.”

Dollar General’s core consumer is “always strained” due to their economic status, but also resourceful, Vasos said.

“We’ve started to see where [our customer is] getting her sea legs, if you will, on the additional inflation that’s been very sticky out there, and she’s starting to understand her budgets even more,” Vasos said.

Part of the uncertainty, Vasos said, stems from the potential impact of President Donald Trump’s tariffs on the consumer.

When Trump imposed tariffs during his first term in office in 2018 and 2019, Dollar General had to raise some prices in line with others in the industry, Vasos said. But the general store was able to mitigate the impact back then and is “well positioned” to do so again this year, he said.

“Given the already stressed financial condition of our core customer, we are closely monitoring these and any other potential economic headwinds, including any changes to government entitlement programs,” Vasos said.

CFO Kelly Dilts said the company’s 2025 guidance factors in continued economic pressure on the consumer, but does not account for further changes to tariff policy or government initiatives like the Supplemental Nutrition Assistance Program, which subsidizes food for low-income Americans.

For the fourth-quarter, Dollar General said same-store sales growth of 1.2% was driven entirely by 2.3% growth in average transaction. Customer traffic fell 1.1% during the period, “impacted by ongoing financial pressures of our core consumer,” Vasos said.

Alongside its fourth-quarter earnings, Dollar General said Thursday it would close 96 Dollar General stores and 45 Popshelf stores and will convert six other Popshelf stores into flagship banner locations this year. Popshelf primarily serves higher-income shoppers with lower-priced products.

Shares of Dollar General rose 5% Thursday morning.

Donatella Versace announced Thursday that she is stepping down as chief creative officer of Versace, ending her nearly 30-year-long stint at the Italian luxury fashion empire’s helm.

Versace, 69, took on the role to lead the luxury fashion house after her brother and its founder, Gianni Versace, was fatally gunned down outside his Miami Beach mansion in 1997.

‘It has been the greatest honor of my life to carry on my brother Gianni’s legacy,’ Versace wrote on Instagram. ‘He was the true genius, but I hope I have some of his spirit and tenacity.’

Following her brother’s death — and despite not having a background in design or fashion — Versace quickly became a living embodiment of the Versace brand and remains a beloved figure within the fashion industry.

Italian fashion designer Gianni Versace.Toni Thorimbert / Sygma via Getty Images file

The 69-year-old’s iconic pin-straight blond hair and her unparalleled ability to bring together the industry’s top models, including Naomi Campbell and Cindy Crawford, for the fashion house’s out-of-this-world runway shows became as emblematic of the brand as its gold mythological logo.Emmanuel Gintzburger, CEO of Versace — whose parent company is fashion conglomerate Capri Holdings — said that the brand ‘is what it is today because of Donatella Versace and the passion she has brought to her role every day for nearly thirty years.’

‘The universal values she stands for and her love for uncompromised creativity anchored Versace far beyond a brand or a company,’ he said in a statement. ‘Working alongside her has been an incredible privilege and pleasure.’

Dario Vitale, the former design and image director of Italian brand Miu Miu, will lead the fashion house as its new chief creative officer, the company said in a statement.

“I want to express my sincere thank you to Donatella for her trust in me, and for her tireless dedication to the extraordinary brand that Versace is today,” Vitale said in a statement. “It is a privilege to contribute to the future growth of Versace and its global impact through my vision, expertise and dedication.”

Versace will stay on at the company as its chief brand ambassador.

‘I will remain Versace’s most passionate supporter,’ she said. ‘Versace is in my DNA and always in my heart.’

Spirit Airlines is out of bankruptcy, hitting its target to emerge in the first quarter, after a crippling few years. CEO Ted Christie says the carrier is leaner and ready to take on competitors, including rival Southwest Airlines.

Earlier this week, Southwest shocked customers by announcing it will start charging for checked bags for the first time in its half-century of flying, a huge strategy move for the largest domestic U.S. carrier. (There are some exceptions to Southwest new bag rules, which take effect in late May.)

“I think it’s going to be painful for a little bit as they find their footing, and we’re going to take advantage of that,” Spirit’s Christie said in an interview Thursday.

Southwest had been a standout in the U.S. by offering all customers two free checked bags, a perk that has endured recessions, spikes in fuel prices and other crises while most rivals introduced bag fees and raised them every few years.

Spirit Airlines, on the other hand, made a la carte pricing common in the U.S., with fees for seat assignments, checked bags and other add-ons. It’s a strategy most large airlines, except for Southwest, have copied in one form or another.

As Southwest starts charging for bags and introduces its first basic economy class, which doesn’t include a seat assignment or allow free changes, Spirit could possibly win over customers, Christie said.

Southwest said it would get rid of its single-class open seating model last year.

“There at least was an audience of people who were intentionally selecting and flying Southwest because they felt that it was easy. They knew they were going to get two bags,” Christie said. “Now that that’s no longer the case, it’s easy to say that they’re going to widen their aperture and they’re now going to look around.”

Spirit is far smaller than Southwest and even smaller than it was last year, but it competes with the airline in cities like Kansas City, Missouri; Nashville, Columbus, Ohio; and Milwaukee. If customers look on travel sites like Expedia, where Southwest is a new entrant, Spirit’s tickets could be cheaper and appear higher in results, Christie said.

Other airline executives have also said they expect to win over some Southwest customers.

Delta Air Lines President Glen Hauenstein said at a JPMorgan industry conference Tuesday that there are consumers who choose Southwest based on its free-bag perk “and now those customers are up for grabs.”

Spirit, for its part, has recently been offering more ticket bundles that include things like seat assignments and luggage.

The carrier is now focused on returning to profitability. It posted a net loss of more than $1.2 billion last year, more than double its loss in 2023 as it grappled with grounded jets because of a Pratt & Whitney engine recall, higher costs, more domestic competition and a failed acquisition by JetBlue Airways.

Spirit has rejected multiple recent merger attempts by fellow budget carrier Frontier Airlines. Christie said Thursday that nothing is “off the table” and that a fifth-largest airline as a low cost carrier in the U.S. makes sense, but that the airline is focused on stabilizing itself after bankruptcy.

Through its restructuring process, which started in November, Spirit said it reduced its debt by about $795 million. The transaction converted debt into equity for major creditors. The carrier also received a $350 million equity infusion.

Spirit plans to relist its shares on a stock exchange but hasn’t set a date yet.

More than eight out of every 10 respondents to a Morgan Stanley survey believe Tesla CEO Elon Musk’s controversial political activities are hurting his business.

In total, 85% of the 245 participants polled by the firm believe Musk’s foray into politics has either had a “negative” or “extremely negative” impact on business fundamentals. The majority of respondents also expect Tesla deliveries to fall this year, according to the survey.

While a small sampling, these results offer the latest sign of mounting frustration with the billionaire entrepreneur as he’s become a rising figure in international and American politics. It also comes at a pivotal point for Tesla’s stock, with shares plunging nearly 40% this year.

When asked about Musk’s efforts with U.S. government efficiency and other political activities, 45% of respondents said these actions had a “negative” effect on the company. Another 40% said they were having an “extremely negative” impact.

On the other hand, 3% said they were “positive” for the business. Meanwhile, 12% called them “insignificant.”

To be sure, Morgan Stanley analyst Adam Jonas reported that his survey respondents are drawn from his email distribution list and should not be taken as a random representative sample. He also noted that the respondents are not necessarily owners of Tesla stock. The survey was taken over a 17-hour period, starting on Tuesday afternoon.

Jonas also asked about expectations for the company’s performance. In a separate question, 59% said they anticipated Tesla would deliver fewer cars to customers in 2025 compared with the prior year. What’s more, 21% of total respondents said they expected a decline of more than 10%. That comes as some analysts have raised alarm that recent reports of vandalism could spook potential customers.

Just 19% of responders said they forecasted deliveries to rise in 2025, while another 23% said they would be flat between the two years.

Musk’s political profile has grown after his public support of President Donald Trump in the runup up to last year’s election and his subsequent role leading the Department of Government Efficiency, or DOGE. The Tesla executive’s efforts to slash the federal government’s spending and workforce has drawn the ire of critics who see his team as working too quickly and haphazardly.

Musk acknowledged in an interview with Fox Business on Monday that his high-profile role in Trump’s administration meant he was running his businesses, which also include X and SpaceX, “with great difficulty.” That day, Tesla shares tumbled more than 15% for their worst session since 2020.

Despite the recent nosedive, 45% of respondents said they anticipate Tesla shares will be at least 11% higher by the end of the calendar year. Around 36% expect the stock to tumble another 11% or further by year-end, while 19% see the stock staying within 10% of its price around $220.

After a New York Times report last week unearthed criticisms of Musk’s team from members of Trump’s cabinet, the president offered a vote of confidence on Tuesday. Trump evaluated five Tesla vehicles parked at the White House after the president said on social media that he would buy one as a symbol of support.

Trump also said he would declare violence at Tesla dealerships to be acts of domestic terrorism.

The Federal Trade Commission asked a judge in Seattle to delay the start of its trial accusing Amazon of duping consumers into signing up for its Prime program, citing resource constraints.

Attorneys for the FTC made the request during a status hearing on Wednesday before Judge John Chun in the U.S. District Court for the Western District of Washington. Chun had set a Sept. 22 start date for the trial.

Jonathan Cohen, an attorney for the FTC, asked Chun for a two-month continuance on the case due to staffing and budgetary shortfalls.

The FTC’s request to delay due to staffing constraints comes amid a push by the Trump administration’s Department of Government Efficiency to reduce spending. DOGE, which is led by tech baron Elon Musk, has slashed the federal government’s workforce by more than 62,000 workers in February alone.

“We have lost employees in the agency, in our division and on our case team,” Cohen said.

Chun asked Cohen how the FTC’s situation “will be different in two months” if the agency is “in crisis now, as far as resources.” Cohen responded by saying that he “cannot guarantee if things won’t be even worse.” He pointed to the possibility that the FTC may have to move to another office “unexpectedly,” which could hamper its ability to prepare for the trial.

“But there’s a lot of reason to believe … we may have been through the brunt of it, at least for a little while,” Cohen said.

John Hueston, an attorney for Amazon, disputed Cohen’s request to push back the trial date.

“There has been no showing on this call that the government does not have the resources to proceed to trial with the trial date as presently set,” Hueston said. “What I heard is that they’ve got the whole trial team still intact. Maybe there’s going to be an office move. And by the way, both in government and private sector, I’ve never heard of an office move being more than a few days disruptive.”

The FTC sued Amazon in June 2023, alleging that the online retailer was deceiving millions of customers into signing up for its Prime program and sabotaging their attempts to cancel it.

“Amazon tricked and trapped people into recurring subscriptions without their consent, not only frustrating users but also costing them significant money,” former FTC Chair Lina Khan said at the time.

The FTC has also brought a separate case against Amazon, accusing it of wielding an illegal monopoly, in part by preventing sellers from offering cheaper prices elsewhere through its anti-discounting measures. That case, which the FTC filed in September 2023, is set to go to trial in October 2026.

Dick’s Sporting Goods on Tuesday said it’s expecting 2025 profits to be far lower than Wall Street anticipated, making it the latest retailer to forecast a rocky year ahead as consumers contend with tariffs, inflation and fears around a potential recession. 

In an interview with CNBC, Executive Chairman Ed Stack said the company’s exposure to China, Mexico and Canada for sourcing is very small, but it recognizes that falling consumer confidence could impact spending.

“I do think it’s just a bit of an uncertain world out there right now,” said Stack. “What’s going to happen from a tariff standpoint? You know, if tariffs are put in place and prices rise the way that they might, what’s going to happen with the consumer?”

On a call with analysts, CEO Lauren Hobart insisted the company is not seeing a weak consumer, and said its guidance is based on the overall uncertain environment.

“We definitely are feeling great about our consumer,” said Hobart. “We are just reflecting an appropriate level of caution given so much uncertainty out in the marketplace.”

Shares of the company opened about 2% lower.

Despite the weak guidance, the sporting goods retailer posted its best holiday quarter on record. Its comparable sales rose 6.4%, far ahead of the 2.9% growth that analysts expected, according to StreetAccount. 

Here’s how Dick’s did in its fiscal fourth quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

Earnings per share: $3.62 vs. $3.53 expected

Revenue: $3.89 billion vs. $3.78 billion expected

The company’s reported net income for the three-month period that ended Feb. 1 was $300 million, or $3.62 per share, compared with $296 million, or $3.57 per share, a year earlier.  

Sales rose to $3.89 billion, up about 0.5% from $3.88 billion a year earlier. Like other retailers, Dick’s benefited from an extra week in the year-ago period, which has skewed comparisons. But unlike many of its peers, Dick’s still managed to grow both sales and profits during the quarter, even with one less selling week. 

In the year ahead, Dick’s is expecting earnings per share to be between $13.80 and $14.40, well short of Wall Street estimates of $14.86, according to LSEG. It anticipates net sales will be between $13.6 billion and $13.9 billion, which at the high end is in line with estimates of $13.9 billion, according to LSEG. Dick’s expecting comparable sales to grow between 1% and 3%, compared with estimates of up 2.5%, according to StreetAccount. 

The gloomy earnings outlook comes after a wide array of other retailers gave weak forecasts for the current quarter or the year ahead amid concerns about sliding consumer confidence and the impact tariffs and inflation could have on spending. Kohl’s also offered a weak outlook for the year ahead on Tuesday, leading its shares to plummet 15%.

Some retailers blamed an unseasonably cool February for a weak start to the current quarter, but most recognized they’re also operating in a tough macroeconomic backdrop, and it’s harder than ever to forecast how consumers are holding up. In February, consumer confidence slid to its lowest levels since 2021, the jobs report came in weaker than expected and unemployment ticked up. Over the last few years, a strong job market has led many economists to brush away concerns about rising credit card delinquencies and debt, but those cracks could grow deeper if unemployment continues to rise. 

On Monday, some of those concerns triggered a stock market sell-off, extending losses after the S&P 500 posted three consecutive negative weeks. The Nasdaq Composite saw its worst day since September 2022, while the Dow lost nearly 900 points and closed below its 200-day moving average for the first time since Nov. 1, 2023.

Beyond the uncertain macroeconomic environment, Dick’s plans to invest more heavily in its “House of Sport” concept and e-commerce in the year ahead, which it also expects will weigh on profits. The massive, 100,000-square-foot stores are a growth area for the company and include features like rock climbing walls and running tracks. 

In the year ahead, Dick’s plans to spend $1 billion on a net basis building 16 additional House of Sport locations and 18 Field House locations, which take some of the experimental elements of the House of Sport but fit it into the size of a traditional Dick’s store. 

The strategy comes at a strong point for sports in the country, which is expected to be a tail wind for the business. The 2026 World Cup will be held in North America, women’s sports are more popular than ever, and consumers are increasingly focused on health and wellness. 

“We’re going to have a moment here in the next three or four years, from a sports standpoint, that I think is going to put sport on steroids,” said Stack. “We’re going into a sports moment right now, and we are investing very heavily into that sports moment over the next several years because this is going to last through [2030] and maybe beyond.”

— Additional reporting by CNBC’s Courtney Reagan.

It’s happening: Southwest Airlines will start charging passengers to check bags for the first time.

It’s a stunning reversal that shows the low-cost pioneer is willing to part with a customer perk executives have said set it apart from rivals in more than half a century of flying in hopes of increasing revenue.

Southwest’s changes come after months of pressure from activist Elliott Investment Management. The firm took a stake in the airline last year and won five board seats as it pushed for quick changes at the company, which held on for decades — until now — to perks such as free checked bags, changeable tickets and open seating.

For tickets purchased on or after May 28, Southwest customers in all but the top tier-fare class will have to pay to check bags, though there will be exceptions. Elite frequent flyers who hold “A-List Preferred” status will still get two bags and A-List level members will get one free checked bag. Southwest credit card holders will also get one free checked bag.

“Two bags fly free” is a registered trademark on Southwest’s website. But its decision to about-face on what executives long cast as a sacrosanct passenger perk brings the largest U.S. domestic carrier in line with its rivals, which together generated $5.5 billion from bag fees last year, according to federal data.

Southwest executives have long said they didn’t plan to charge for bags, telling Wall Street analysts that it was a major reason why customers chose the airline.

“After fare and schedule, bags fly free is cited as the No. 1 issue in terms of why customers choose Southwest,” CEO Bob Jordan said on an earnings call last July.

But Southwest has changed its tune.

“What’s changed is that we’ve come to realize that we need more revenue to cover our costs,” COO Andrew Watterson said in an interview with CNBC about the baggage fee changes. “We think that these changes that we’re announcing today will lead to less of that share shift than would have been the case otherwise.”

In September, Southwest’s then-chief transformation officer, Ryan Green, told analysts that its analysis showed Southwest would lose more money from passengers defecting to rivals if it started charging for bags than it would make from the fees.

“The fact that free bags is a key driver of choice creates the risk that customers may choose the competition if we change the policy,” he said.

Southwest said last month that it had parted ways with Green.

The airline also said Tuesday that it will launch a new, basic economy fare, something rivals have offered for years.

Southwest, in addition, will change the way customers earn Rapid Rewards: Customers will earn more of the frequent flyer miles depending on how much they pay. Redemption rates will vary depending on flight demand, a dynamic pricing model competitors use.

And flight credits for tickets for tickets purchased on or after May 28 will expire one year, or earlier, depending on the type of fare purchased.

It’s the latest in a string of massive strategy changes at Southwest as its performance has fallen behind rivals.

Last July, Southwest shocked passengers when it announced it would ditch its open seating model for assigned seats and add “premium” extra legroom options, ending decades of an single-class cabin.

The airline is also looking to slash its costs. Higher expenses coming out of the pandemic have taken a bite out of airline margins.

Last month, Southwest announced its first mass layoff, cutting about 1,750 jobs roughly 15% of its corporate staff, many of them at its headquarters, a decision CEO Jordan called “unprecedented” in the carrier’s more than 53 years of flying.

“We are at a pivotal moment as we transform Southwest Airlines into a leaner, faster, and more agile organization,” he said last month.

Earlier this year, Southwest announced the retirement of its longtime finance chief, Tammy Romo, who was replaced by Breeze executive Tom Doxey, and its chief administrative officer, Linda Rutherford. Both executives worked at Southwest for more than 30 years.

Southwest has also cut unprofitable routes, summer internships and employee teambuilding events its held for decades.

Three separate outages appeared to hit Elon Musk’s X social media site Monday as he claimed it was suffering a ‘massive cyberattack.’

Downdetector.com first registered thousands of reports of trouble accessing or using the site around 5:30 a.m. ET. It took about an hour before those issues subsided.

Then, around 9:30 a.m., the issues appeared to flare up again, with as many as 40,000 outage reports detected. It again took about an hour for that incident to dissipate.

Finally, around 11:10 a.m., the issues cropped up again, according to Downdetector.

A representative for X couldn’t immediately be reached for comment.

Musk said Monday afternoon on X that there had been a ‘massive cyberattack’ against the site.

‘We get attacked every day, but this was done with a lot of resources. Either a large, coordinated group and/or a country is involved,” he said. He didn’t post any evidence of a cyberattack.

Experts said the outage was consistent with a distributed denial of service (DDoS) attack, a rudimentary but sometimes effective hacker tactic to overwhelm a website with traffic, effectively knocking it offline.

Isik Mater, the director of research at NetBlocks, a company that tracks global internet connectivity, told NBC News that X had suffered intermittent outages since Monday morning. While establishing a DDoS attack with certainty can be difficult, Mater said, Musk’s claim was plausible.

“It’s difficult to be certain, but given the pattern of three observed outages, a denial [of] service attack targeting X’s infrastructure can’t be ruled out,” she said. “It’s certainly one of the longest X/Twitter outages in our records.”

Musk said in an interview Monday afternoon on Fox Business that the outage was due to “a massive cyberattack to try to bring down the X system with IP addresses originating in the Ukraine area,” a reference to internet protocol addresses. IP addresses, strings of numbers assigned to all internet-connected devices, include codes indicating their countries of origin.

Large DDoS attacks usually rely on large armies of hacked devices from around the world. The IP addresses of the devices used against X aren’t public, and they are unlikely to be a reliable indication of where the attacker was based.

Tesla’s selloff on Wall Street intensified on Monday, with shares of the electric vehicle maker plunging 15%, their worst day on the market since September 2020.

On Friday, Tesla wrapped up a seventh straight week of losses, its longest losing streak since debuting on the Nasdaq in 2010. The stock has fallen every week since CEO Elon Musk went to Washington, D.C., to take on a major role in the second Trump White House.

Since peaking at $479.86 on Dec. 17, Tesla shares have lost over 50% of their value, wiping out over $800 billion in market cap. Monday marked the stock’s seventh worst day on record.

Tesla led a broader slump in U.S. equities, with the Nasdaq tumbling almost 4%, its steepest decline since 2022.

The downdraft in Tesla’s stock on Monday was tied to uncertainty surrounding President Donald Trump’s plans on tariffs. Canada and Mexico are key markets for automotive suppliers, and increased tariffs, with the potential for a trade war, will likely impact production and lead to higher prices.

Tesla is also dealing with brand erosion due to Musk’s incendiary political rhetoric and his extensive work with the Trump administration, where he’s leading up the so-called Department of Government Efficiency. Musk, the world’s wealthiest person, has become the public face of the administration’s effort to dramatically shrink the federal government’s workforce, spending and capacity.

Meanwhile, Musk has used his social network X to level accusations against judges whose decisions he didn’t like and promoted false Kremlin talking points about Ukraine President Volodymyr Zelenskyy.

Activists and former Musk fans have protested at Tesla facilities throughout the U.S., and Tesla vehicles and facilities have been the apparent targets of vandalism and arson attempts. Repeated arson attempts and instances of vandalism occurred at a Tesla store and service center in Loveland, Colorado, most recently on March 7, police told CNBC.

Ben Kallo, an analyst at Baird, told CNBC’s “Squawk on the Street” on Monday that recent reports of vandalism could hurt demand.

“When people’s cars are in jeopardy of being keyed or set on fire out there, even people who support Musk or are indifferent Musk might think twice about buying a Tesla,” Kallo said.

Analysts at Bank of America’s wrote in a report on Monday that Tesla new vehicle sales plummeted by about 50% in Europe in January from a year earlier, partly owing to growing distaste for the brand. The firm also noted that some prospective customers are waiting for the new version of the Model Y.

Tesla’s Model Y, which is a small SUV, remained the best-selling battery electric vehicle globally in January. It was followed by China’s Geely Geome, which surpassed the Tesla Model 3 sedan for the month.

Global sales of electric vehicles, including fully electric and plug-in hybrid models, increased 21% in January from a year ago, even as Tesla’s sales declined. The growth was driven by demand in Europe, according to Bank of America.

— CNBC’s Jesse Pound contributed to this report.

If you receive more Social Security benefits than you are owed, you may face a 100% default withholding rate from your monthly checks once a new policy goes into effect.

The change announced last week by the Social Security Administration marks a reversal from a 10% default withholding rate that was put in place last year after some beneficiaries received letters demanding immediate repayments for sums that were sometimes tens of thousands of dollars.

The discrepancy — called overpayments — happens when Social Security beneficiaries receive more money than they are owed.

The erroneous payment amounts may occur when beneficiaries fail to report to the Social Security Administration changes in their circumstances that may affect their benefits, according to a 2024 Congressional Research Service report. Overpayments can also happen if the agency does not process the information promptly or due to errors in the way data was entered, how a policy was applied or in the administrative process, according to the report.

The Social Security Administration paid about $6.5 billion in retirement and disability benefit overpayments in fiscal year 2022, which represents 0.5% of total benefits paid, the Congressional Research Service said in its 2024 report. The agency also paid about $4.6 billion in overpayments for Supplemental Security Income, or SSI, benefits in that year, or about 8% of total benefits paid.

The Social Security Administration recovered about $4.9 billion in Social Security and SSI overpayments in fiscal year 2023. However, the agency had about $23 billion in uncollected overpayments at the end of the 2023 fiscal year, according to the Congressional Research Service.

By defaulting to a 100% withholding rate for overpayments, the Social Security Administration said it may recover about $7 billion in the next decade. 

“We have the significant responsibility to be good stewards of the trust funds for the American people,” Lee Dudek, acting commissioner of the Social Security Administration, said in a statement. “It is our duty to revise the overpayment repayment policy back to full withholding, as it was during the Obama administration and first Trump administration, to properly safeguard taxpayer funds.”

The new 100% withholding rate will apply to new overpayments of Social Security benefits, according to the agency. The withholding rate for SSI overpayments will remain at 10%.

Social Security beneficiaries who are overpaid benefits after March 27 will automatically be subject to the new 100% withholding rate.

Individuals affected will have the right to appeal both the overpayment decision and the amount, according to the agency. They may also ask for a waiver of the overpayment, if either they cannot afford to pay the money back or if they believe they are not at fault. While an initial appeal or waiver is pending, the agency will not require repayment.

Beneficiaries who cannot afford to fully repay the Social Security Administration may also request a lower recovery rate either by calling the agency or visiting their local office.

For beneficiaries who had an overpayment before March 27, the withholding rate will stay the same and no action is required, the agency said.

The new overpayment policy goes into effect about one year after former Social Security Commissioner Martin O’Malley implemented a 10% default withholding rate.

The change was prompted by financial struggles some beneficiaries faced in repaying large sums to the Social Security Administration.

At a March 2024 Senate committee hearing, O’Malley called the policy of intercepting 100% of a benefit check “clawback cruelty.”

At the same hearing, Sen. Raphael Warnock, D-Georgia, recalled how one constituent who was overpaid $58,000 could not afford to pay her rent after the Social Security Administration reduced her monthly checks.

Following the Social Security Administration’s announcement that it will return to 100% as the default withholding rate, the National Committee to Preserve Social Security and Medicare said it is concerned the agency may be more susceptible to overpayment errors as it cuts staff.

“This action, ostensibly taken to cut costs at SSA, needlessly punishes beneficiaries who receive overpayment notices — usually through no fault of their own,” the National Committee to Preserve Social Security and Medicare, an advocacy organization, said in a statement.