Effective Dates: 05/02/2019 - Present Previous | Next

TN 15 (05-19)

DI 10505.005 Determining and Verifying Gross Earnings from Employment

A. Determining gross earnings

When determining whether a claimant or beneficiary works at substantial gainful activity (SGA) levels, consider:

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    when he or she worked; and

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    how much he or she earned for the work activity for the period you are evaluating.

When developing monthly gross earnings, be alert to claimants or beneficiaries who:

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    may be in a position to defer or suppress the amount of reported earnings (e.g., family employment, corporate officer); or

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    received earnings, but may not have actually worked for them (e.g., sick leave, military casualty, vacation pay, paid time off, disability payments); or

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    may be eligible for work incentive deductions. For policies on how to determine countable earnings when impairment related work expenses (IRWEs), special conditions, or subsidies may apply, refer to DI 10505.010.

    NOTE: To determine monthly earnings, multiply weekly earnings (hourly rate of pay x hours worked) by 4.333.

B. Documenting work activity

Document work activity using the form SSA-821-BK (Work Activity Report - Employee) per DI 10505.035, to obtain the following information:

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    name of employer and type of work;

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    dates of employment;

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    hours worked;

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    rate of pay and when he or she earned payments;

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    non-work pay (e.g. sick pay, special pay, etc.); and

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    work incentive information (e.g., subsidies, IRWEs).

Review the information provided on the report to verify work activity following instructions in DI 10505.005C for post entitlement determinations and DI 10505.005D for initial claims.

NOTE: Do not complete an SSA-821-BK when earnings are “clearly not SGA.” For a definition of “clearly not SGA,” see DI 10505.003.

NOTE: It is not necessary to develop work incentive information if the evidence shows that the difference between gross and countable earnings would not change the ultimate SGA determination. For information about determining countable income, see DI 10505.003.

C. Verifying earnings for post-entitlement determinations

1. Policy for paid earnings versus earned earnings

The Bipartisan Budget Act of 2015 simplifies post entitlement SGA determinations by allowing us to presume earnings were earned in the month they were paid. However, prior to applying this paid versus earned assumption, evaluate any readily available earnings verification sources and determine when earnings were earned. If there is no readily available evidence to determine when earnings were earned, use other sources of earnings verification even if the earnings source only documents when earnings are paid. This policy applies to all post-entitlement determinations made after September 23, 2016, including trial work period and reopening determinations.

NOTE: Our Due Process notice advises beneficiaries that we may have used earnings information based on when paid and advises the beneficiary of the opportunity to provide additional information regarding when the pay was earned.

2. Hierarchical list of earnings verification sources

Verify earnings using the following sources in order. If you believe evidence from a source is not accurate, proceed down the priority list to find more accurate earnings information.

a. Paystubs on file

Use paystubs that are available at the time of the review. Check the paystub table in eWork for submitted wages. If the paystub table has paystubs from two or more sources for the same employer for the same period of time, but the amounts conflict, select the paystub in the following order:

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    Earning posted by a Social Security employee (SSAE)

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    Earnings reported online by a beneficiary or representative payee (MyWR)

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    Earnings reported by the Employment Network (ENI).

Use the Pay Distribution Calculator to convert weekly or bi-weekly earnings into monthly totals. Record monthly earnings on the eWork Earnings Details screen, and code them as verified by Paystubs. For any months that you are unable to determine an accurate amount, proceed to the next available earnings source. You may use a combination of paystubs and other earnings sources to complete the review.

NOTE: You may also use paystub evidence stored in other repositories. For example, the Supplemental Security Income monthly wage verification application (SSIMWV) or paystubs scanned into the claims file user interface (CFUI). Use SSIMWV paystubs only if they include pay period information, and you can determine when the pay was earned.

b. Third-party payroll provider

If the employer participates with The Work Number, Verify Advantage or any other SSA-approved wage verification company, and you have a recently signed or attested SSA-821-BK (12 months or less), verify earnings using the third-party payroll provided data. For more information on participating wage verification companies, see SI 00820.147. Generally, you can determine when earnings are earned based on pay period start and end date. Use the Pay Distribution Calculator to convert weekly or bi-weekly earnings into monthly totals. Record monthly earnings on the eWork Earnings Details screen, and code them as verified by electronic wage verification (EWV). If you are unable to determine when earnings were earned or the employer does not use a third-party payroll provider, proceed to next source of earnings.

NOTE: The SSA-8240 and the response captured in Wage and Employment Information Authorization (WEIA) application are not approved authorizations for EWV. For more information on WEIA, see GN 00204.150

c. Paystubs

If the beneficiary can provide paystubs information within 15 days for field offices or 35 days for processing service centers, use paystub data. When pay period start and end dates are available, use the Pay Distribution Calculator to convert weekly or bi-weekly earnings from paystubs into monthly totals. Record monthly earnings on the eWork Earnings Details screen, and code them as verified by Paystubs. If paystub information is incomplete or inconsistent, and additional evidence of earnings is needed, proceed to next source of earnings. You may use a combination of paystubs and other earnings sources to complete the review.

d. Supplemental Security Income (SSI) verified wages

Check SSI systems for verified monthly earnings. Input the earnings into eWork and code them as SSI wages.

e. National Directory of New Hires (NDNH)

Check the NDNH for quarterly earnings. Use the date work started information from the SSA-821-BK or the date hired information from the NDNH to determine the number of months worked in the quarter, and divide the earnings amount accordingly. If there is no SSA-821-BK and no date hired information on the NDNH, divide quarterly earnings by three, and enter monthly earnings on the eWork Earnings Details screen. Show verified by NDNH.

f. The summary earnings query (SEQY) or detail earnings query (DEQY)

Check the SEQY or DEQY. Use the date work started information from the SSA-821-BK or the date hired information from the NDNH to determine the number of months worked in the year, and divide the earnings amount accordingly. If you are unable to determine the number of months worked in the year, use the Quick Distribution button to distribute earnings throughout the year, and show verified by SEQY/DEQY.

g. SSA-L725

The SSA-L725 is a last resort, and all other sources of earnings verification should be pursued before using it. However, if no other source of earnings verification is available, send an SSA-L725 request to the employer. Tickle the case for 15 days for field office and 35 days for PC processing. If earnings information is received, code monthly earnings on the eWork Earnings Details screen as verified by SSA-L725.

NOTE: If the employer participates in an SSA-approved third party payroll provider, but you are unable to access the information because you do not have appropriate authorization (i.e., you do not have a signed/attested SSA-821-BK), do not send the SSA-L725.

D. Verifying earnings for Initial Claims

1. Policy for determining when wages were earned

Adjudicators must verify when wages are earned to determine the potential onset date (POD). Resolve significant discrepancies between the claimant’s allegation and verification obtained. Significant discrepancies are those that:

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    Cannot be accounted for and resolved as a difference between paid versus earned (or another posting reason); and

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    Could result in a change in the POD.

For additional information about the POD, see DI 25501.220.

NOTE: Use the initial claim earnings hierarchy when verifying earnings during an application for expedited reinstatement.

2. Hierarchical list of earnings verification sources for initial claims

Verify earnings using the following sources in order. If you believe evidence from a source is not accurate, proceed down the priority list to find more accurate earnings information.

a. Immediately available paystubs

Use the paystubs that are submitted with the initial claim. If the paystub information is incomplete or inconsistent, and additional information is needed, proceed to the next source.

b. Third-party payroll provider documents earnings when earned

If the employer participates with The Work Number, Verify Advantage or any other SSA-approved wage verification company, and you have a signed or attested SSA-821-BK (12 months or less), verify earnings using the third-party payroll provider data. Use the Pay Distribution Calculator to convert weekly or bi-weekly earnings into monthly totals. If you are unable to determine when earnings were earned or the employer does not use a third-party payroll provider, proceed to next source of earnings.

c. Paystubs

If the beneficiary can provide paystubs information within 15 days, use paystub data. You may use Pay Distribution Calculator to convert weekly or bi-weekly earnings from paystubs into monthly totals. If additional evidence of earnings is needed proceed to next source of earnings.

NOTE: You may also use paystub evidence stored in the SSI monthly wage verification application (SSIMWV). Use SSIMWV paystubs only if they include pay period information, and you can determine when the pay was earned.

d. SSA-L725

Send an SSA-L725 request to the employer to determine when earnings were earned. Tickle the case for 15 days. If the employer does not return the form or the information is incomplete, proceed to the next source.

NOTE: If the employer participates in an SSA-approved third party payroll provider, but you are unable to access the information because you do not have appropriate authorization (i.e., you do not have a signed/attested SSA-821-BK), do not send the SSA-L725

e. SSI verified wages

Check SSI systems for verified monthly earnings. Compare earnings data with SSA-821-BK information to determine when wages were earned.

f. NDNH

Use the NDNH only as a starting point when investigating earnings for SSDI claimants in initial claims. If you are unable to determine the monthly earnings based on NDNH information and the information on the SSA-821-BK, make your determination using the instructions in DI 10505.035E.1.

g. SEQY or DEQY

Use the SEQY or DEQY data only as a starting point when investigating earnings for SSDI claimants in initial claims. If you are unable to determine the monthly earnings based on SEQY or DEQY information and the information on the SSA-821-BK, make your determination using the instructions in DI 10505.035E.1.

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DI 10505.005 - Determining and Verifying Gross Earnings from Employment - 05/02/2019
Batch run: 10/30/2024
Rev:05/02/2019