GAO's annual improper payments report on fiscal year 2024, released in March 2025 (GAO-25-107753), found that 16 federal agencies reported a combined estimate of about $162 billion in improper payments across 68 programs. About $135 billion of that — roughly 84 percent — was overpayments, meaning the government paid out more than was owed.
What is an improper payment?
Federal law defines an improper payment as any payment that should not have been made, was made in the wrong amount, or lacked adequate documentation. The category includes fraud, but most reported improper payments are errors: an agency paying a benefit based on outdated income information, a duplicate invoice, or an eligibility mistake. GAO emphasizes that the figures are estimates, and that several large programs are exempted or report unreliable data, so the true national figure is uncertain.
How big is the problem?
The $162 billion estimate was about $74 billion lower than the prior year's figure, a drop driven largely by reporting changes and updated program estimates rather than a single-year cleanup. Large entitlement programs account for most of the total: Medicare and Medicaid, unemployment insurance, the earned income tax credit, and rental assistance have historically been among the largest sources. Congressional researchers have tallied roughly $3 trillion in reported improper payments since fiscal 2004, though definitions and coverage have changed over that period.
Related stories: Federal rental assistance still can't produce a reliable error rate · Auditors keep finding the same roots of Social Security overpayments.
What happens next?
Under the Payment Integrity Information Act, agencies must publish annual improper payment estimates, post corrective action plans, and designate accountable officials. GAO reviews those reports each spring and flags programs whose estimates are unreliable or missing. Agencies with high error rates face corrective plans that Congress and agency inspectors general track over time.
What it means for you
If you receive a federal benefit, improper payments cut both ways: an overpayment to you can be clawed back later, sometimes years after the fact, while underpayments mean money you were owed never arrived. The annual report is where to see which programs have the highest error rates — and whether your program's estimate is considered reliable or too shaky to publish. Payment accuracy is also why agencies increasingly verify income and eligibility data against other federal records.
The report also breaks the totals into overpayments and underpayments, because the remedies differ. Overpayments usually require recovery efforts that cost money and can burden beneficiaries; underpayments mean people received less than the law entitles them to. GAO has repeatedly noted that a meaningful share of reported amounts came from programs using estimates rather than actual tests of payments, which is why the office treats the headline figure as a floor of what is known rather than a precise measurement.