A debtor whose wages are subject to AWG may, at any time, request a review of the
amount or percentage garnished based on financial hardship or materially changed circumstances
such as disability, divorce, or catastrophic illness which result in financial hardship.
The decision on whether to reduce the amount or percentage of the garnishment is not
an initial determination subject to appeal rights.
IMPORTANT: SSA will not reduce the amount the employer withholds from someone's pay if the
debt was caused by intentional false statement or willful concealment of or failure
to furnish material information. (Willful concealment means an intentional, knowing
and purposeful delay in providing, or failure to reveal, material information.) Do
not take action on a request for lower garnishment amount due to hardship when the
debt was caused by intentional false statement or willful concealment of or failure
to furnish material information.
The procedure for handling a debtor's request for a lower garnishment amount depends
upon whether SSA can approve the request immediately, or SSA requires financial information
from the debtor before deciding on the request. SSA's approval can be granted immediately
when:
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(1) the person agrees to a garnishment amount that is at least $10 per payday and
which would permit collection within 12 months, and
(2) the person agrees to a garnishment amount of at least $10 per payday that will
recover the debt within 60 months and the person can demonstrate that a higher amount
would prevent the payment of ordinary and necessary living expenses.
“Ordinary and necessary living expenses” include fixed expenses such as food, clothing, housing, utilities, maintenance, insurance,
tax payments, medical, hospitalization and similar expenses, expenses for the support
of others for whom they are legally responsible, and other reasonable and necessary
miscellaneous expenses which are part of their standard of living. Refer to GN 02201.041B.5.a. for instructions on processing immediate approvals of hardship requests.
NOTE: A request for hardship does not prevent or stop TOP or credit bureau reporting.
a. Immediate approval of hardship request TSC/FO/PC action
The process for granting an immediate approval of a hardship request is the same for
the TSC, FO and PC. Proceed as follows when granting immediate approval:
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Negotiate the highest garnishment amount but not less than $10 per payday. If the
debtor alleges not being able to pay $10 per payday, explain that $10 is the minimum
amount SSA can accept.
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If the debtor offers to repay the debt at the rate of at least $10 per payday and
that rate would recover the debt within 12 months, enter the negotiated amount or
percentage on the AWG Update Garnishment Information (TRGA) screen. (Refer to MSOM
DMS 014.014). This will result in an automated notice to the employer and the debtor
advising them of the reduced garnishment amount.
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If the debtor offers to repay the debt at the rate of at least $10 per payday and
that rate would recover the debt within 60 months, advise the debtor that SSA will
grant the lower amount if answers to the following questions indicate hardship (i.e.,
expenses exceed income and assets):
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1.
What is the amount of your income (weekly or monthly)?
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2.
How much do you pay each week or month for ordinary and necessary living expenses?
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3.
Do you have a savings account, certificate of deposit (CD) or an individual retirement
account (IRA)? If “yes” record the type of account and the value. If “no”, indicate “caller alleges no assets”.
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Enter the negotiated dollar amount or percentage on the AWG Update Garnishment Information
(TRGA) screen. Refer to MSOM DMS 014.014 for more detailed information about that
screen. The system will send an automated notice to the employer and the debtor advising
them of the lowered garnishment amount.
b. Immediate approval not possible
TSC Action
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Enter the hardship requested on the AWG Suspend Garnishment for Hardship (TRSU) screen.
Refer to MSOM DMS 014.013 for more detailed information about the screen.
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Advise the caller that in order to consider his/her request for hardship, documentation
of income, assets and expenses is required.
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Cross-out section 1 on the SSA-634, annotate "AWG Withholding Request", and include
a courtesy return envelope to the servicing FO.
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Send the caller the SSA-634 to complete.
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Advise the caller that we will review the SSA-634 and the hardship request. When we
complete our action, we will send a written notice with our decision to the debtor.
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Record the action taken and needed on DMS Remarks.
FO/DMS Action
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Check to make sure the AWG Suspend Garnishment for Hardship (TRSU) screen has been
input. Refer to MSOM DMS 014.013. If not, make appropriate input to the screen.
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Advise the person that in order to consider his/her request for hardship, documentation
of income, assets and expenses is required.
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Cross-out section 1 on the SSA-634, annotate "AWG Withholding Request", and give the
caller the SSA-634 to complete.
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Advise the caller that we will review the SSA-634 and the hardship request. When we
complete our action, we will send a written notice with our decision to the debtor.
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If the decision is to grant the request for a lower garnishment amount due to hardship,
enter the negotiated amount or percentage on the AWG Update Garnishment Information
(TRGA) screen. (Refer to MSOM DMS 014.014.)
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If the decision is to deny the request for a lower garnishment amount, select "Resume
Garnishment" on the AWG Update Garnishment Information (TRGA) screen. (Refer to MSOM
DMS 014.014.)
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If the "Resume Garnishment" field on the TRGA screen is selected, an automated notice
will be sent to the employer asking that the garnishment be resumed and a copy of
the notice will be sent to the debtor.
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If a new amount or new percentage has been entered on the TRGA screen BEFORE the garnishment
package is sent to the employer, no notice is sent to the employer. If a decision
is made AFTER the garnishment package is sent to the employer, an automated notice
will be sent to the employer advising him/her of the new garnishment amount or percentage.
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Record the action taken and needed on DMS Remarks.