TN 16 (10-01)

GN 00605.068 How To Evaluate Payee Responses About Conserved Funds

A. Introduction

This section explains how to review the payee's responses to questions about conserved funds as an indication of how well the payee manages the beneficiary's funds.

B. Background

These questions are designed to ask for the amount saved or invested for the beneficiary.

In order that title II conserved funds for each beneficiary can be recorded on the offline conserved funds file, question 3C on the “multi-beneficiary” SSA-6230-OCR-SM asks for the amount saved for each of the children listed. Each child's BIC, first name and middle initial is computer printed in Question 3C on the title II SSA-6230-OCR-SM.

C. Policy

SSA recommends that conserved funds over $500 be held in U.S. savings bonds or in an interest yielding checking or savings account that is insured under either federal or state law. Since payees are investing the beneficiary's funds, the rules governing conserved funds are very conservative to avoid any loss to the beneficiary. The investment must clearly show that the beneficiary is the owner and any interest earned belongs to the beneficiary.

D. Reference

  • How to resolve questionable responses about the amount of conserved funds, and the manner in which they are held, GN 00603.000

  • How to input title II conserved funds to the offline conserved funds file and update the conserved funds field on the SSR, GN 00605.050

E. Exhibits — conserved funds questions

1. SSA-623-OCR-SM Questions 3.D. and 4.

The following is an exhibit of questions of 3.D. and 4. of the SSA-623-OCR-SM (09/2001).

G-GN_00605.068E-1

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2. SSA-6230-OCR-SM Questions 3.C. and 4.

The following is an exhibit of questions 3.C. and 4. of the SSA-6230-OCR-SM (09/2001)

G-GN_00605.068E-2

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F. Procedure — amount of conserved funds

The amount of benefits saved may indicate either excessive or improper spending practices, or spending insufficient to meet the beneficiary's needs. Use the following instructions to determine if further development is necessary. Ask the payee to report the latest amount of benefits saved for the beneficiary.

NOTE: Field offices receive an R8 alert (SI 01140.021) to review SSI cases, including concurrent cases, when the accounting form is processed in WBDOC and the form shows conserved funds exceeding $2000. In some of these cases, the payee-reported conserved funds may include funds set aside in a Plan to Achieve Self-Support for Blind or Disabled People (PASS) (SI 00870.001). PASS funds are excluded from resource limitations as long as the Plan is in effect. The FO would discover the existence of a PASS in their subsequent investigation of the conserved funds.

If a Processing Center (PC) receives an eRPA exception alert on a case in which PASS funds are involved and the conserved funds exceed $2000, the PC should assume the FO has received the R8 alert and is developing the excessive conserved funds amount. The PC should ignore the conserved funds issue and resolve any other appropriate exceptions as necessary.

1. Examine the amount of conserved funds

NOTE: The payee will show any conserved funds amount in Question 3D on the SSA-623-OCR-SM or Question 3C on the SSA-6230-OCR-SM.

2. Evaluate Title II conserved funds

Decision Factors: The FO should contact the payee to ensure adequate funds are being spent for the beneficiary's well-being in the following scenarios:

  • Conserved funds reported is less than 20% of the Total Accountable Amount (TAA) and the TAA is greater than $25,000; or

  • Conserved funds reported is less than 20% of previously recorded conserved funds and previously recorded conserved funds is greater than $5,000; or

  • For Title II cases, conserved funds are greater than $10,000.

Compute 25% of the Total Accountable Amount (if there is only one beneficiary).

Decision Factors: Apply this instruction only if the reported conserved funds (CF) is $5000 or more for any beneficiary and you are contacting the payee to resolve some other issue.

REMINDER: If the payee reported for more than one child on an SSA-6230-OCR-SM, divide the benefits paid amount shown on line 1 under item 3 by the number of children displayed on the report. Add each child's portion of that amount to the CF amount displayed for that child in the top portion of the form.

Is the current amount of conserved funds greater than 25% of the conserved funds plus each child's portion of the benefits paid amount?

  • If yes, Approve the amount of conserved funds.

  • If no, Contact the payee for an explanation.

EXAMPLE: The payee reported savings of $4000 for each of 3 children shown in Question 3C on a SSA-6230-OCR-SM. The benefits paid amount shown in line 1 under Question 3 is $10,500. The CF amount displayed in the top portion of the form for C1 is $2000; CF for C2 is $6000; CF for C3 is $8000.

Determine each child's portion of the benefits paid amount:

$10,500 divided by 3 = $3500.

CF for C1 is less than $5000. Stop for C1.

For C2, CF plus benefits paid amount = $9,500; 25% = $2375.

For C3, the sum is $11,500; 25% = $2875.

Since the payee reported current savings greater than 25% of the CF plus the benefits paid amount for both C2 and C3, no further development action is necessary.

3. Evaluate Title XVI conserved funds

Decision Factors: The FO should contact the payee to ensure adequate funds are being spent for the beneficiary's well-being in the following scenarios:

  • Conserved funds reported is less than 20% of the Total Accountable Amount (TAA) and the TAA is greater than $25,000; or

  • Conserved funds reported is less than 20% of previously recorded conserved funds and previously recorded conserved funds is greater than $5,000.

Decision Factor: A large amount of conserved SSI payments may indicate that the payee is not spending enough to meet the beneficiary's needs.

Develop according to GN 00603.001B.2. if the payee shows current conserved funds more than three times the Federal Benefit Rate (but less than $2,000) and the payee must be contacted for another reason.

IMPORTANT: SSI eligibility is questionable if a recipient's resources equal or exceed $2000. The FO must develop continued eligibility when a payee for title XVI (and concurrent) benefits indicates conserved funds of $2,000 or more.

G. Procedure — type of account

Decision Factor: Apply this instruction if the payee indicates conserved funds exceed $500.00 on the SSA-623 or SSA-6234, or exceed $1250.00 on the SSA-6230.

1. Acceptable investments

Approve responses that indicate the conserved funds are properly titled (see GN 00605.068H) and held, in any of these types of investment:

  1. Individual savings and/or checking account.

  2. U.S. savings bonds, Treasury bills, certificates of deposit (CD's) or other federally insured plans (such as a Direct Express card account, to name one).

  3. Collective savings and/or checking account and the institution, agency, or individual payee (e.g., a lawyer whose law firm is not the payee but the individual is) is listed on the collective account precedent file in RPS (see MSOM RPS 008.012 and MSOM RPS 008.016). For individual payees, the type of payee will usually be coded as “OTH” (Other) on the MBR/SSR/RPS. Refer to GN 00603.020 for the policy governing the establishment of collective savings/checking accounts to hold benefits belonging to more than one beneficiary.

2. Questionable investments

Develop according to the “prudent person rule” described in GN 00603.040 if the payee indicates that conserved funds are held in any manner other than shown in GN 00605.068G.1.

EXAMPLE: Questionable investments include the stock market and mutual funds.

H. Procedure — account title

Decision Factor: Apply this instruction if the amount of conserved funds exceeds $500.00 on the SSA-623 or SSA-6234, or exceeds $1250.00 on the SSA-6230.

1. Acceptable titles

Approve responses that indicate that an approved investment (see GN 00605.068G.1.) bears the following types of titles:

  1. Individual savings and/or checking accounts:

    • (Beneficiary Name) by (Payee Name)

    • (Payee Name) for (Beneficiary Name)

      EXCEPTION for Spouses and Parents: A checking account established by a spouse, or (natural, adoptive or step) parent with custody of a minor child(ren), does not have to show beneficiary ownership. However, an individual savings account must show the child as the owner of the account, as described in GN 00603.010B.1.

  2. U.S. savings bonds registered as specified in GN 00603.030B.

  3. Collective savings and/or checking account title described in GN 00603.020:

    • (Payee Name) representative payee for Social Security Beneficiaries

  4. Other titles as shown in GN 00603.010 and GN 00603.030.

2. Questionable titles

If the payee indicates an account or investment title other than those shown in GN 00605.068.H.1., the FO should take the following steps:

Step

Action

1

Contact the payee and explain acceptable titles. Ask the payee to:

  • Change the title on the account or investment and submit a copy of the correction; or

  • Submit a signed statement from the bank that, according to State law, the title meets SSA criteria for beneficiary ownership.

  • Advise the payee that the information/evidence must be provided within 30 days.

2

Was a title correction or bank statement received?

  • If yes, Approve the response on the accounting report.

  • If no, Go to Step 3.

3

Request the ARC, Programs consult with the regional attorney to determine whether the title meets SSA criteria and is proper under State law. Are SSA criteria met regarding whether the beneficiary has ownership of the investment?

  • If yes, Approve the payee's response on the accounting report.

  • If no, Consider changing the payee or paying benefits directly to the beneficiary.


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