Social Security grace year & non-service month

I worked Jan/Feb then retired end of Feb 2013 & cashed in annual/sick leave. I started receiving Social Security in March. My total earnings for the 2 months were over the annual limit. Now they say I have an overpayment but from what I have read I have a grace year the first year and special pay such as annual/sick does not count. Am I wrong?
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Not sure if there is such a thing as a "Grace Year", but there can be a problem with what SS calls "special payments".
They try to explain the issue at this web page
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Basically vacation and sick pay for previous years should not affect your benefits. Here is the example they give at this webpage:
"Example of a special payment This example shows how we apply a special payment under Social Security rules. Mr. DeSilva retired at age 62 in November 2014 and began to receive Social Security benefits. In January 2015, Mr. DeSilva receives a check from his employer for $17,000 for his leftover vacation time. Because this is for vacation pay he earned before he retired, Social Security will consider it a special payment and will not count it toward the earnings limit for 2015."
To correct this, you need to contact SS, either in person or by phone.
Again, quoting: "If you get Social Security and your total yearly earnings exceed the limit and these earnings include a special payment, you should contact Social Security. Tell us you think you received a special payment. If we agree, we will not count the special payment as part of your total earnings for the year."
Also, the notice you received should have info on how to appeal the "overpayment".
Good luck........
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