Netting is the process used to determine whether there is an overpayment or an underpayment.
It is a part of the payment computation process. All excess payments and additional
amounts due for the period (see SI 02201.005B.3.b.) under review are compared. The result is the net over/underpayment amount.
NOTE: Netting is not a method of overpayment recovery. It is the procedure used to determine
the amount of an underpayment or the outstanding balance due.
Beginning September 2002 the system will, in most cases, automatically compute 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/or can not send an automated notice,
it will set a B3 diary. See SM 01311.633 for instructions on resolving B3 diaries.
If the system cannot perform automated netting and/or cannot send an automated notice,
the Field Office (FO) is required to manually net the period under review and/or issue
the appropriate initial overpayment (or underpayment) notice.
See SM 01311.160B.2. and SM 01311.160B.3. for cases that are excluded from automated