Effective Dates: 05/08/2026 - Present Previous | Next

TN 140 (05-26)

SI 02220.015 Supplemental Security Income Overpayment - Recovery By Adjustment

CITATIONS:

Social Security Act §1631(b)(1) 20 C.F.R. §§416.535, 416.538, 416.543, 416.551,416.560, 416.570,416.571

A. Introduction

When we have overpaid an individual who is eligible for Supplemental Security Income (SSI), we must adjust the future payments or past-due payments due to the individual or their eligible spouse to recover the overpayment if waiver of adjustment or recovery is not applicable, refer to SI 02220.015B.1.

B. Policy for recovery by adjustment

1. Adjustment of current or past-due payment

  1. a. 

    Following a determination that an overpayment exists, and after we have issued notice of overpayment to the overpaid individual or their eligible spouse, we must recover the overpayment by adjusting future payments to the overpaid individual or their eligible spouse and adjust any past-due payment if certain conditions are met, refer to SI 02220.015B.1.b unless we approve a request for waiver.

  2. b. 

    We adjust payment by withholding future payments to recover an overpayment if:

    • •

      the overpaid individual has not refunded the overpayment;

    • •

      eligibility continues;

    • •

      there is no approved or pending overpayment reconsideration request, refer to SI 02220.001A.2 and SI 02220.017A.1.

    • •

      there is no approved overpayment waiver request that fully waives recovery of the overpayment from the overpaid individual, refer to SI 02220.001A.2; and

    • •

      there is no pending waiver request, or if a waiver request is pending, an initial determination has been made to deny the request, refer to SI 02220.001A.2.

2. Overpayment recovery

We will recover overpayments of any federally administered State supplement before we recover a federal SSI overpayment for the same period.

3. Couple's cases

If a spouse who was previously ineligible for SSI becomes eligible and is owed an underpayment, we will not use their underpayment to recover or reduce their spouse’s overpayment if the overpayment happened outside the new couple computation period. However, there are two exceptions:

  • •

    The underpaid spouse agrees to let us use their underpayments to offset their spouse's overpayment, and

  • •

    The overpaid spouse has exhausted all appeal rights.

The overpaid spouse is considered to have exhausted appeal rights if:

  • •

    there is no pending request for waiver; and

  • •

    there is no pending request for reconsideration or other appeal of the overpayment determination, or the time period for filing an appeal has passed and there is no pending request for an extension due to good cause.

Example of overpayment to one member of new couple outside of the couple computation period

Jennifer Jones and Jason House each receive SSI as individuals. Jennifer and Jason marry, report the marriage to us, and become an SSI eligible couple. Jennifer is due an underpayment of $1,500.00 for the period prior to becoming an SSI couple. Jason is overpaid by $1,000.00. We will not apply Jennifer's underpayment to recover Jason's overpayment unless Jennifer agrees to allow us to use their underpayment to offset Jason's overpayment, and Jason has exhausted appeal rights.

4. Offset of underpayments against overpayments

  1. a. 

    Once an overpayment has been assessed, we use any underpayment due an individual to reduce (i.e., recover) any outstanding overpayment owed by that individual if we have issued an initial overpayment notice to the individual, refer to SI 02201.015, SM 01311.170.

  2. b. 

    If the overpaid individual is deceased, refer to SI 02101.003 and SI 02220.045.

C. Procedures for overpayment adjustment

1. Offsetting underpayments against overpayments

  1. a. 

    In most cases, the SSI claims system will automatically offset an underpayment against an outstanding overpayment balance when there is a D TAC (recover by check adjustment) on the Supplemental Security Record (SSR). Refer to SM 01311.170.

    If the underpayment amount exceeds the overpayment balance, issue the remainder of the underpayment to the individual.

  2. b. 

    In cases that require manual offsetting:

    • •

      If an overpayment has been determined (i.e., after netting, refer to SI 02220.015B.5. and SI 02201.015B.), and

    • •

      The overpaid individual has received an initial overpayment notice and the appeal period has expired SI 02201.015C.; SM 01311.170, then

    • •

      Use any subsequent underpayment to offset the overpayment balance.

  3. c. 

    If one member of an eligible couple is underpaid and the other member is overpaid, release the underpayment unless the underpaid member agrees to use their underpayment to offset their spouse's overpayment and the overpaid spouse has exhausted appeal rights. Refer to SI 02201.010B.4., SI 02201.015A.4., and SI 02201.022.

2. Change to nonpayment after adjustment begins

In almost all cases the system replaces an inappropriate type of action code (TAC) with the correct one. For the few cases that require manual resolution of a B8 diary, refer to SM 01311.638. For a B9 diary refer to SM 01311.639 and process accordingly.

a. If the initial overpayment notice has not been issued:

  • •

    Prepare and issue the notice, and

  • •

    Input the notice date.

b. If we have issued the initial overpayment notice, the period to request reconsideration has expired, and there is no pending request for an explanation of the overpayment, or waiver request that has not received an initial determination:

  • •

    Determine the uncollected balance of eachD TAC on the record.

  • •

    If none of the D TACs have been recovered, replace each D TAC with a G TAC equal to the uncollected balance. The recovery rate for the G TAC will be equal to the uncollected balance.

  • •

    If the D TAC(s) have been partially recovered, input a D TAC equal to the recovered amount and a G TAC equal to the uncollected balance. The recovery rate for the G TAC will be equal to the uncollected balance.

For instructions to manually place an overpaid record under RECOOP control refer to SM 01311.235.

D. Netting

Netting is not a method of overpayment recovery; rather, it is the process used to determine whether, as part of the payment computation process, an under- or overpayment exists. It is the procedure we use to determine the amount of an underpayment or the outstanding overpayment balance due. Netting is a part of the payment computation process. We compare excess payments and additional amounts due for the period under review, refer to SI 02201.005C.6. The result is the net overpayment or underpayment amount due for the period under review.

In most cases, the system automatically computes the net amount for all periods where there are excess payments and additional amounts due for the period(s) under review. If the net result is an overpayment, the system will create an overpayment sequence for the period under review. The system will, in most cases, notify the individual of the net result either by sending a post eligibility notice and issuing an underpayment or by sending an initial overpayment notice. If the system cannot perform automated netting and cannot send an automated notice, it will set a B3 diary (unresolved overpayment indicator), which the field office (FO) must process manually unless the case is under Recovery and Collection of Overpayment Process (RECOOP). For instructions on resolving B3 diaries, refer to SM 01311.633; for cases that are excluded from automated netting refer to SM 01311.160B.1, and for overpayment sequence processing see SM 01310.200.

To perform Manual Netting, refer to SM 01311.165B.

To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0502220015
SI 02220.015 - Supplemental Security Income Overpayment - Recovery By Adjustment - 05/08/2026
Batch run: 05/08/2026
Rev:05/08/2026