The Foster Care Independence Act of 1999 (FCIA) extends to the title XVI program all the debt collection authorities currently available for the collection of overpayments under the title II program. For information on title II collections by Administrative Offset, see GN 02201.031.

Administrative offset is the reduction or withholding of federal or state payments that an individual receives in order to recover a delinquent debt owed by that person to the federal government. Various federal payments, such as travel, expense reimbursements, Office of Personnel Management (OPM) pensions, and federal contractor payments, as well as eligible state payments, which include state income tax refunds, are subject to administrative offset to recover certain past due title XVI overpayment debts.

OPM pensions are subject to a reduction of up to 25% of the net payment. Vendor payments such as federal contractor payments and travel and expense reimbursements, are subject to a reduction of up to 100% of the net payment until the overpayment is repaid.

SSA's automated systems select certain title XVI debts for recovery by administrative offset. All the following criteria apply:

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  The debtor must be alive;

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  The debtor is not eligible for Supplemental Security Income benefits;

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  The debtor was at least 18 years of age when the debt was incurred;

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  The debt must be $25.00 or more;

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  The debt must be delinquent (for the definition of the term “delinquent”see SI 02220.012B.2.);

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  The debt must be considered to be “unrecoverable” under regulations determined by the Commissioner of Social Security (for the definition of “unrecoverable”see SI 02220.013B.1 in this section).

Once a debt is selected for administrative offset, SSA must send the debtor a pre-offset notice. ECO retrieves a verified address for the debtor from an Address Verification Contractor (AVC).

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  If the AVC provides a good address, the pre-offset notice is mailed to that address.

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  If the AVC does not return a good address and the MBR or Supplemental Security Record (SSR) was updated within the last year, the notice is mailed to the address on the MBR or SSR.

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  If there is no good address from the AVC and the MBR or SSR address was updated more than a year ago, the AVC will be checked again in six (6) months. The pre-offset notice will be mailed once a good address is obtained.

For more information on handling undeliverable pre-offset notices, refer to GN 02201.030F in this section.

For more information on the selection, notification, and referral process, refer to GN 02201.029C.

The pre-offset notice informs the debtor:

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  A delinquent overpayment debt in a particular amount is owed;

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  SSA plans to:

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    refer the debt to Treasury for TOP, and

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    if applicable, conduct administrative wage garnishment, and

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    send information about the debt to credit bureaus after 60 days have expired from the date on the notice;

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  SSA will not take this action if, before the end of that 60-day period, the debtor

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    pays the debt in full,

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    makes regular installment payments under an agreement with SSA,

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    requests waiver, or

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    furnishes evidence showing the debt;

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      (all or part of the stated amount) is not owed or

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      SSA does not have the right to collect the debt; and

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  That the debtor may review and copy SSA's records about the debt.

SSA considers a title XVI debt to be unrecoverable if it meets all the following conditions:

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  The RECOOP billing status is past due, or the debt has been written off as uncollectible (SSI overpayment sequence with a "DB" or "DM" TAC code, see SM 01311.200);

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  SSA has not entered into an installment agreement with the debtor within the past 30 days, or the debtor has failed to make any payment for forty five days;

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  No appeal or waiver is pending;

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  The debtor is a former recipient.

An SSI debt is unrecoverable when it meets the definition in SI 02220.013B.1. For purposes of the administrative offset program, a specific unrecoverable date is not required.

If a request for an explanation of the overpayment is received, use the SSID to provide an explanation of the overpayment. Keep explanations generic to the extent possible. For example: "Your were no longer disabled as of 05/24 and continued to received checks through 12/24."

Follow instructions in SI 02220.012D.2.

Follow the instructions in SI 02220.012D.3and SI 02220.012E.

Advise the debtor that administrative offset remains in effect until SSA receives a completed and signed SSA-632-BK (or its equivalent).

Follow the instructions in SI 02220.012D.4.

Follow the instructions in SI 02220.012D.5.

Follow instructions in SI 02220.012D.7.

Follow the instructions in SI 02220.030 and sensitive instructions in SI 02220.031.

If SSA agrees to the offer, stress that payment must be received by us before the 60-day due process period expires, or we will report the debt to TOP.

Follow the instructions in SI 02220.012D.9.

Follow the instructions in SI 02220.012D.10.

Follow instructions in SI 02220.012D.11.

Follow the instructions in SI 02220.012E.1.

Follow the instructions in SI 02220.012E.2.

Follow the instructions in SI 02220.012E.3.

Follow the instructions in SI 02220.012E.4.

Follow instructions in SI 02220.012E.5.

Follow instructions in SI 02220.012E.6.