TN 19 (05-14)
GN 03920.055 Failure to Withhold Past-due Benefits for Direct Payment to a Representative
A. Failure to withhold past-due benefits
Due to administrative oversight, we sometimes fail to pay an authorized fee to an eligible representative who qualifies for direct fee payment because we:
When a decision maker either approves a fee agreement or authorizes a fee, and a processing center (PC) or field office (FO) fails to withhold past-due benefits for direct fee payment, the office with jurisdiction of the fee payment must notify both the claimant and the representative of the error.
1. Failure to withhold in a fee agreement case
If we sent notice of the fee agreement approval and fee amount but we failed to withhold past-due benefits, send the failure to withhold language per GN 03920.055B in this section.
If the decision maker approved the fee agreement, but we did not compute the fee amount, nor did we withhold past-due benefits, send a manual notice that includes the:
fee agreement determination,
amount of the fee,
administrative review rights, and
failure to withhold language per GN 03920.055B in this section.
If the decision maker has not made a determination on the fee agreement, and we failed to withhold past-due benefits:
refer claims decided below the hearing level to the appropriate PC or FO decision maker for a determination; or
contact the Office of Hearings Operations (OHO) or the Attorney Fee Branch (AFB) for a determination, per GN 03940.025C.3.
2. Failure to withhold in a fee petition or court case
If we have not yet determined the fee under the fee petition process, or we have not received a fee order from a court, do not take any action until the fee is determined. Set a diary, if one has not been set, following the instructions in GN 03930.045. For additional information regarding a court ordered fee, see GN 03920.060B.5
Once the fee has been determined, review the fee authorization notice (i.e., SSA-1560A) to determine if it includes failure to withhold language. If it includes failure to withhold language, no additional notice is necessary regarding the fee. If it does not include failure to withhold language, send the failure to withhold language in GN 03920.055B in this section.
NOTE: If the case is concurrent, the PC must first determine the title II portion of the fee. The PC informs the FO of the title II portion of the fee, using the E4345 application. The FO then revises the previous windfall computation that did not include the title II fee, and if necessary, computes the title XVI portion of the fee. The office with jurisdiction of the fee payment notifies both the claimant and the representative of the failure to withhold (i.e., the PC for title II and the FO for title XVI).
NOTE: If the claimant has filed for bankruptcy, see GN 02215.185A.3.
B. “Failure to withhold” notice language
1. “Failure to withhold” notice language for title II claims
Send exhibit letter E3812 to the claimant, and send a copy to the representative per NL 00703.812.
2. “Failure to withhold” notice language for title XVI claims
Use the following language to inform the claimant and the representative when we fail to withhold past due benefits for title XVI claims. Send the notice to the claimant and a copy to the representative.
“We show that you chose (1) to act as your representative in your claim for Supplemental Security Income. By law, we must hold back up to 25 percent of your past-due benefits to pay the representative. (2).
We should have held $(3) from your benefits to pay all or part of the fee. Since we released these benefits to you, the representative will look to you for payment of your share of the fee. Your share of the authorized fee is $(4).
The representative may contact us at the above address if you do not pay the fee. If the representative asks us to collect payment from you, we will:
pay the representative the amount we should have held from you, minus any service charge we must keep by law; and
recover from you the amount we should have held.
If the authorized fee is more than the amount we should have held, you must pay any remaining fee balance.
We will send your representative a copy of this notice.”
(1) Representative’s name
(2) Choice 1 – However, we paid all past-due benefits to you.
Choice 2 – After we reimbursed the State, we paid all remaining past-due benefits to you.
(3) Amount we should have withheld from the claimant’s past-due benefits for payment of the representative’s fee as determined in GN 03920.017D Procedure – Amount of Direct Payment prior to imposing the assessment on the representative’s payment.”
(4) Authorized fee owed by this claimant
NOTE: All fee notices that involve the spouse in a title XVI couples case are manual notices. Adjust the notice in GN 03920.055B.2. in this section, as necessary, when notifying the spouse.
C. Representative unable to collect fee from claimant
If the representative reports he or she has been unable to collect the fee from the claimant, the office with jurisdiction of the fee payment will take the following actions:
Pay the representative the maximum amount we should have paid from the claimant’s title II past-due benefits, title XVI past-due benefits, or both per GN 03920.017D, Procedure – Amount of Direct Payment; and
Initiate overpayment recovery procedures from the claimant, by refund or adjustment, of the amount paid to the representative, plus the withheld assessment amount. For additional information regarding the assessment, refer to Assessment on Representatives Who Receive Direct Payment, in GN 03920.019.
If the claimant requests a waiver, follow the waiver procedures:
NOTE: If we properly paid a representative's fee, and subsequently the representative files an untimely request for administrative review, we assume no responsibility for payment of an increased fee amount determined on administrative review. For additional information on late filed requests for administrative review, see the fee agreement process in GN 03960.025, or the fee petition process in GN 03960.020.
GN 03920.017C Policy – Titles II and XVI - Direct Payment to Representatives
GN 03920.035 Title II Past-Due Benefits Subject to Withholding
GN 03920.036 Title XVI Past-Due Benefits Subject to Withholding
GN 02610.047 How to Complete Section I of Record of Manual Title II Computation – SSA-4345-U2
GN 02610.053 How to Process Title II Offset Cases When a Representative Fee Is Involved – Action to Apply Offset (Second Day Action in the PC) Taken On or After July 1, 1991
GN 02610.050E Case type: Processing cases when Title II retroactive benefits are released erroneously before applying windfall offset
SI 02006.205 Identification and Notification of Affected Claimant and Their Representatives and Development of Title II Data
SI 02006.040 Erroneous Release of Retroactive Title II Benefits