TN 7 (09-17)

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 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

  • work above the BOND yearly amount (or partial year (prorated) BOND amount). This is $12,840.00 in 2014, for a non-blind individual; $21,600.00 for a stat blind individual.

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

1. Offset start date

The start date of offset will be the later of the:

  • Applicant’s disability cessation (ADC) date, plus three months; or

  • BOND participation start date.

If the start date of participation is January of the current year and the end date of participation is not in the current year, the full year offset calculation applies (see DI 60099.040D in this section). If there are less than 12 months in the participation period for any given year, the partial year calculation applies (see DI 60099.040C in this section).

2. Offset end date

The end date of offset participation will be 60-months after the start date of participation. The end date of offset and the end date of participation are the same.

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.

3. Non-countable earnings

The following items are considered non-countable earnings:

  • IRWE amount(s) for the offset period,

  • subsidy amount(s) for the offset period,

  • earnings paid 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 paid during the offset period (i.e., vacation or sick pay).

4. Partial year offset calculation

Take the following steps to calculate a partial year offset earnings estimate:

  • 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 for offset amount for the year.

  • Divide the total available for 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.

5. Example of a partial year offset calculation

Mary Doe was selected to participate in BOND in May 2011. We sent Mary 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 Mary that she would receive full benefit checks for January 2012, the month of cessation, and the following two months of her grace period.

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

Mary contacts the BOND site office, which collects an earnings estimate from her. Mary estimates earned income of $32,000 in 2012, and indicates she pays $100 per month in medication co-payments. Mary also reports that she needs medication to control mood swings associated with her disabling impairment. Site staff enters the following information from Mary in the 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 Mary was paid $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 (9) to determine the monthly offset amount (rounding up to nearest dime).

$778.50

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

C. Full year offset

1. Non-countable earnings

The following items are considered non-countable earnings:

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

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

2. Full year offset calculation

Take the following steps to calculate a full year offset earnings estimate:

  • 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 for the year.

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

NOTE: Round up to the nearest dime.

3. Example of a full year offset calculation

John Doe contacts his local BOND site office to provide an updated earnings estimate for the coming year. John 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 John and sends it to BOND stand-alone system (BSAS) via the BODS:

  • date of report: 12/5/2011;

  • 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 ($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 John’s monthly benefit amount by $461.70.

D. 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.

E. 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.

F. 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 is eligible for a partial offset amount, the auxiliaries continue to receive full monthly benefits. If the BOND beneficiary does go into full BOND offset (LAF SQ.), any auxiliary benefits will also stop due to the BOND beneficiary’s work activity (LAF SQ).

G. 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 Research, Demonstration, and Employment Support (ORDES). Abt instructs BOND beneficiaries to submit proof of work incentives and other non-countable income. Abt downloads that information in the BOND Operations Data System (BODS). The BOND work CDR unit is responsible for reviewing the evidence and making a determination on the deductions. ORDES documents the decision in the BOND stand-alone system (BSAS) and stores the determination notice in the online retrieval system (ORS). When a FO or PSC receives proof of work deductions, fax those proofs into NDRED/eView/EF and send an MDW to L5R.During the end-of-year reconciliation process, we exclude any unproven work incentives, non- countable income, or denied estimates from verified earnings.