TN 1 (01-12)

DI 60099.040 Benefit Offset National Demonstration (BOND) Offset

A. Eligibility for the $1 for $2 offset

To be eligible for the $1 for $2 offset, a BOND participant (For definition of BOND participant, please see DI 60099.015) must:

  • complete the nine-month TWP by September 30, 2017;

  • have disability ceased due to SGA;

  • have received payment for the grace period;

  • be within the BOND participation period (For a definition of BOND participation, please see DI 60099.035); and

  • currently work above the BOND yearly amount (or partial year (prorated) BOND amount).

A BOND participant who completes the TWP and grace period after random assignment becomes eligible for the benefit offset beginning with the month after the grace period ends, provided the BOND participation period has not ended.

B. Start and end date of offset

If the BOND participant meets the eligibility requirements explained in DI 60099.040A. the start date of offset will be the later of the applicant’s disability cessation (ADC) date, plus three months or the start date of participation. If the start date of participation is January of the current year and the end date of participation is not in the current year, apply the full year offset calculation (DI 60099.040D. in this section). If there are less than 12 months in the participation period for any given year, use the partial year calculation (DI 60099.040C. in this section).

C. Partial year offset

We base the amount of the monthly offset on the annual estimate of earnings whether or not a full or partial year offset applies. When applying an offset for partial years, we only count earnings for the months the individual is eligible for the offset. The beneficiary continues to provide an estimate of his or her annual gross earnings or net earnings from self-employment (NESE) for the entire calendar year.

1. Determine non-countable earnings

Add the following items to determine the total non-countable earnings:

  • IRWE amount(s) for the offset period,

  • Subsidy amount(s) for the offset period,

  • Earnings prior to the first month of offset, or after the end date of the offset and participation period, and

  • Earnings not related to work activity for the offset period (i.e., vacation or sick pay).

2. Partial year offset calculation

Take the following steps to calculate partial year offset earnings:

  • Subtract the total non-countable earnings from the annual estimated earnings amount. This will be the countable earnings estimate.

  • Multiply the number of months in the offset period by the monthly substantial gainful activity (SGA) rate. This is the partial BOND amount for the beneficiary.

  • Subtract the partial BOND amount from the countable earnings estimate.

  • Divide the excess earnings amount by 2 (for the $1 for $2). This will be the total available offset amount.

  • Divide the total available offset amount by the number of months in the offset period to determine the monthly total available for offset.

    NOTE: Round up to the nearest dime.

3. Example of partial year offset

Sylvie Bliss was selected to participate in BOND in May 2011. We sent Sylvie a substantial gainful activity (SGA) determination notice informing her that she completed her trial work period (TWP) and her disability ceased due to SGA in January 2012. The notice informed Sylvie that she would receive full benefit checks for January 2012, the month of cessation, and the following two months of her grace period.

Sylvie’s benefits are offset, effective April 2012, the month after her grace period ended.

Sylvie contacts the BOND site office, which collects an earnings estimate from her. Sylvie estimates earned income of $32,000 in 2012, and indicates she pays $100 per month in medication co-payments. Sylvie also reports that she needs medication to control mood swings associated with her disabling impairment. Site staff enters the following information from Sylvie in BOND Operations Data System (BODS):

  • Date of report: 7/5/2012;

  • Year of estimate: 2012;

  • Estimated annual gross earnings for the calendar year: $32,000;

  • Estimated work incentive deductions for the offset period: $900; and

  • Estimated other allowable deductions for the offset period: $0.

We determine that Sylvie earned $7,998 prior to April 2012, the first month of offset. Since this is a partial year offset, SSA deducts nine months (April through December) of the medication co-pays for a total of $900 in impairment-related work expense (IRWE) deductions for the year. We use the following chart to determine the monthly offset amount:

Partial Year $1 for $2 Offset Computation

Step 1

Annual Earnings Estimate

$32,000

Step 2

Total Non-Countable Income:

  • IRWE of $900 (Nine months at $100)

  • The beneficiary estimated earnings prior to first month of offset of $7998 (January to March 2012)

$8,898

Step 3

Determine annual BOND countable estimate by subtracting the amount determined in step 2 from the amount determined in step 1.

$23,102

Step 4

Determine prorated BOND yearly amount (number of months in the offset period x monthly BOND yearly amount, ($1,010 /mo. in 2012))

$9,090

Step 5

Subtract the amount determined in Step 4 from the amount determined in Step 3.

$14,012

Step 6

Divide the amount determined in Step 5 by 2 (to factor in the $1 for $2 offset)

$7,006

Step 7

Divide the amount determined in step 6 by the number of months in the offset period for the year to determine the monthly offset amount (rounding up to nearest dime).

$778.50

When applying the benefit offset, we reduced Sylvie’s monthly benefit amount by $778.50.

D. Full year offset

1. Determine non-countable earnings

Add the following items to determine the total non-countable earnings:

  • The annual IRWE amount(s) and subsidy amount(s), and

  • Earnings not related to work activity for the offset period (i.e., vacation or sick pay).

2. Full year offset calculation

Take the following steps to calculate full year offset earnings:

  • Subtract the total non-countable earnings from the annual estimated earnings amount. This is the countable earnings estimate.

  • Subtract the BOND yearly amount from the countable earnings estimate.

  • Divide the countable earnings amount by 2 (for the $1 for $2). This is the total available for offset.

  • Divide the total available for offset amount by 12 to determine the monthly total available for offset.

    NOTE: Round up to the nearest dime.

3. Example of full year offset calculation

Dillon James contacts his local BOND site office to provide an updated earnings estimate for the coming year. Dillon anticipates earnings of $25,000 in 2012, and alleges IRWE of $150.00 per month. His gross monthly benefit amount is $1,600.  BOND site staff collects the following information from Dillon and sends it to BOND stand-alone system (BSAS) via the BODS:

  • Date of report: 11/5/2011;

  • Year of estimate: 2012;

  • Estimated annual gross earnings for the calendar year: $25,000;

  • Estimated work incentive deductions for the year: $1,800, and

  • Estimated other allowable deductions for the year: $0.

We use the following Full Year $1 for $2 Offset Computation chart to determine the monthly offset amount.

Full Year $1 for $2 Offset Computation

Step 1

Annual Earnings Estimate

$25,000

Step 2

Total Non-Countable Income:

IRWE of $1800 (12 months at $150)

$1,800

Step 3

Determine annual BOND countable estimate by subtracting the amount determined in step 2 from the amount determined in step 1.

$23,200

Step 4

Determine annual BOND yearly amount (shown as $12,120 in 2012))

$12,120

Step 5

Subtract the amount determined in Step 4 from the amount determined in Step 3.

$11,080

Step 6

Divide the amount determined in Step 5 by 2 (to factor the $1 for $2 offset)

$5,540

Step 7

Divide the amount determined in step 6 by 12 to determine the monthly offset amount (rounding up to nearest dime).

$461.70

We reduced Dillon’s monthly benefit amount by $461.70.

E. Full offset

When the monthly total available for offset exceeds the monthly benefit amount, the beneficiary is in full offset. The MBR displays a LAF code of SQ and the RFD displays a code of Q and a RFST of DMPRDD indicating demo project “DD” BOND offset case.

F. Partial offset

When the monthly total available for offset is less than the monthly benefit amount, the beneficiary will be in partial offset. The WIC code “Z” indicates deduction for BOND offset. The beneficiary may or may not be in pay status due to an incorrect payment.

G. Auxiliary payments

Any auxiliaries receiving benefits based on a BOND beneficiary’s record continue to receive full benefits until the BOND beneficiary goes into full offset. As long as the BOND beneficiary receives a partial offset amount, the auxiliaries continue to receive full monthly benefits. When the BOND beneficiary does go into full BOND offset (LAF SQ.), the auxiliaries also have benefits stopped due to the BOND beneficiary’s work activity (LAF SQ).

Non-countable income determinations

We apply the offset after subtracting estimates of work incentives. A determination on these work incentive deductions is the responsibility of the BOND work continuing disability review (CDR) unit in the office of Program Development and Research (OPDR). Abt instructs BOND beneficiaries to submit proof of work incentives and other non-countable income. Abt forwards that information to the BOND work CDR unit. The BOND work CDR unit is responsible for reviewing the evidence and making a determination on the deductions. OPDR documents the decision in the BOND stand-alone system (BSAS) and stores the determination notice in the online retrieval system (ORS).

During the end-of-year reconciliation process, we exclude any non-proven work incentives, non-proven countable income, or denied estimates from verified earnings.

H. Statutory benefit continuation payments for BOND cases

BOND participants are subject to regular medical CDRs. A BOND participant who ceases to have a disabling impairment no longer qualifies for the BOND participation period and is not eligible for the benefit offset unless he or she receives statutory benefit continuation payments based on a medical cessation appeal. In that case, the beneficiary may receive reduced benefit payments under the benefit offset during the appeal if the beneficiary:

  • completed the nine-month TWP by September 30, 2017;

  • had disability ceased due to SGA;

  • was paid for the grace period;

  • is in the BOND participation period (For a definition of BOND participant, please see DI 60099.030.); and

  • works above the BOND partial or yearly amount.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0460099040
DI 60099.040 - Benefit Offset National Demonstration (BOND) Offset - 01/18/2012
Batch run: 01/18/2012
Rev:01/18/2012