TN 20 (10-11)

GN 02604.120 Criteria for Assessing a Penalty

Assess a penalty according to the following criteria.

A. Annual earnings test

  1. If the total excess earnings (TEE) equals or exceeds the monthly benefit credited (MBC), apply the following penalties:

    • First violation

      The penalty equals the MBC.

    • Second violation

      The penalty is two times the MBC unless there is only one deduction month. In that case, the penalty equals the MBC.

    • Third and subsequent violations

      The penalty is three times the MBC unless there are fewer than three deduction months.

    If there are only two deduction months, the penalty is two times the MBC.

    If there is only one deduction month, the penalty equals the MBC.

  2. If the TEE is $10.00 or more but less than the MBC, apply the following penalties:

    • First violation

      The penalty equals the TEE or $10 whichever is larger.

    • Second and subsequent violations

      The penalty equals the MBC when excess earnings are less than MBC or when there is receipt and acceptance of only one-month’s benefit.

  3. If the TEE is less than $10, the penalty is $10 for first and subsequent violations.

B. Foreign work test/child-in-care

Assess a penalty according to the following criteria:

  • First violation

    The penalty equals the MBC for the earliest month for not making a timely report and without good cause.

  • Second violation

    The penalty is two times the MBC unless there is only one month in the violation period or the beneficiary accepted only one month's benefit;

    then the penalty equals the MBC (For information on calculating violations, see GN 02604.130.)

  • Third and subsequent violations

    The penalty is three times the MBC. When deductions are showing or benefits accepted for less than 3 months in the violation period; then the penalty equals the MBC times the number of months involved.

C. Recalculating a penalty amount

Recalculate the penalty amount if any of the following occur:

  • we receive an amended annual earnings report.

  • the calculation of the initial penalty is incorrect.

  • the number of violations changes. For calculating penalty violations, see GN 02604.130.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0202604120
GN 02604.120 - Criteria for Assessing a Penalty - 10/27/2011
Batch run: 10/27/2011
Rev:10/27/2011