BASIC (10-07)

HI 01130.035 Chart of Possible Results of Annual Verification Process

Note that this chart follows the rule that SSA will not use subsequent data to determine a higher IRMAA than the IRMAA based on IRS-provided PY-2 data. The only exceptions to this rule are for amended returns (HI 01120.045) and corrected tax information (HI 01120.050).

If

The IRMAA and T2 System Will

Why

IRS data matches beneficiary report

OR

IRS data is different, but does not change the IRMAA level

Make no change in the IRMAA

None needed

If SSA is Using PY-3 MAGI for the Current Year Determination and

  

IRS PY-2 MAGI is significantly higher than IRS PY-3

Example:

IRS PY-3 = Level 1

IRS PY-2 = Level 2

Identify the Arrearage

Send an IRMAA Annual Verification Predetermination Notice

If no protest after 20 days from date of the notice, send an Annual Verification Correction Notice

Send T2R notice of premium collection or notify the other agency (CMS, RRB) of the new IRMAA determination.

CMS notifies direct bill beneficiaries and collects premium arrearage.

For OPM, SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and collects premium arrearage.

SSA notifies RRB who notifies annuitant and collects premium arrearage.

IRS PY-2 MAGI is significantly lower than IRS PY-3

Example:

IRS PY-3 = Level 3

IRS PY-2 = Level 2

Identify the Overage

Send an IRMAA Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

CMS notifies direct bill beneficiaries and refunds premium overage.

For OPM, SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds premium overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

IRS provides SSN (no PY-2 MAGI information)

Identify the Overage

Send an IRMAA Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

CMS notifies direct bill beneficiaries and refunds premium overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds premium overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

If SSA Originally Used PY-3 MAGI and is now using Beneficiary Supplied PY-2 MAGI for the Current Year Determination and

  

IRS PY-2 MAGI is significantly higher than beneficiary provided PY-2 MAGI

Example:

Bene PY-2 = Level 1

IRS PY-2 = Level 2

Identify the Arrearage

Send an Annual Verification Predetermination Notice

If no protest after 20 days from the date of the notice, send an Annual Verification Correction Notice

Send T2R notice and collect the additional premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination.

CMS notifies direct bill beneficiaries and collects premium arrearage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and collects premium arrearage.

SSA notifies RRB who notifies annuitant and collects premium arrearage.

IRS PY-2 MAGI is significantly lower than beneficiary provided PY-2 MAGI

Example:

Bene PY-2 = Level 2

IRS PY-2 = Level 1

Identify the Overage

Send an IRMAA Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

SSA will not determine a higher IRMAA than that determined using IRS provided PY-2. (Exceptions – Amended Return – HI 01120.045 and Corrected IRS Tax Information – HI 01120.050)

CMS notifies direct bill beneficiaries and refunds premium overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds premium overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

IRS provides no PY-2 MAGI information (SSN only) when beneficiary has provided PY-2 MAGI that resulted in IRMAA

Example:

Bene PY-2 = Level 1

IRS PY-2 = Level 0

Identify the Overage

Send and IRMAA Annual Verification Overage Notice

Send T2R notice and refund appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

SSA will not determine a higher IRMAA than that determined using IRS provided PY-2. (Exceptions – Amended Return – HI 01120.045 and Corrected IRS Tax Information – HI 01120.050)

CMS notifies direct bill beneficiaries and refunds overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

If SSA Originally Used PY-3 MAGI and is now using Beneficiary Supplied PY-1 MAGI for the Current Year Determination and

  

IRS PY-2 MAGI is significantly higher than IRS PY-1 MAGI

AND

IRS PY-1 MAGI is significantly higher than beneficiary provided PY-1 MAGI

Example:

IRS PY-3 = Level 2

Bene PY-1 = Level 1

IRS PY-2 = Level 3

IRS PY-1 = Level 2

The IRMAA system will use IRS PY-1 MAGI to determine the IRMAA

Identify the Arrearage

Send an Annual Verification Predetermination Notice

If no protest after 20 days from the date of the notice, send an Annual Verification Correction Notice

Send T2R notice and collect the additional premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination.

IRS PY-1 MAGI significantly lower than IRS PY-2 MAGI validates the New Initial Determination.

IRS data is the standard in the law.

CMS notifies direct bill beneficiaries and collects premium arrearage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and collects premium arrearage.

SSA notifies RRB who notifies annuitant and collects premium arrearage.

IRS PY-2 MAGI is significantly higher than or the same as IRS PY-1 MAGI

AND

IRS PY-1 MAGI is significantly lower than beneficiary provided PY-1 MAGI

Example:

IRS PY-3 = Level 4

Bene PY-1 = Level 3

IRS PY-2 = Level 2 or 1

IRS PY-1 = Level 2 or 1

The IRMAA system will use IRS PY-1 MAGI to determine the IRMAA

Identify the Overage

Send an Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination.

CMS notifies direct bill beneficiaries and refunds the overage

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds the overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

IRS PY-2 MAGI is significantly lower than IRS PY-1 MAGI

AND

IRS PY-1 MAGI is significantly lower than or the same as beneficiary provided PY-1 MAGI

Example:

IRS PY-3 = Level 3

Bene PY-1 = Level 2

IRS PY-1 = Level 2 or 1

IRS PY-2 = Level 0

SSA uses PY-2 MAGI to determine IRMAA and identifies the Overage

Send an IRMAA Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination.

SSA will not determine a higher IRMAA than that determined using PY-2. (Exception – Amended Return – HI 01120.045 and Corrected IRS Tax Information – HI 01120.050)

CMS notifies direct bill beneficiaries and refunds premium overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds premium overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

IRS provides no PY-2 MAGI (SSN)

AND

IRS provides no PY-1 MAGI (SSN) when beneficiary has provided PY-1 MAGI that resulted in IRMAA

Example:

IRS PY-3 = Level 2

Bene PY-1 = Level 1

IRS PY-2 = Level 0

IRS PY-1 = Level 0

SSA uses PY-2 MAGI and identifies the Overage

Send and IRMAA Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

SSA will not determine a higher IRMAA than that determined using PY-2. (Exceptions – Amended Return – HI 01120.045 and Corrected IRS Tax Information – HI 01120.050)

CMS notifies direct bill beneficiaries and refunds overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

IRS provides no PY-2 MAGI (SSN)

AND

IRS provides PY-1 MAGI higher, lower, or the same as beneficiary provided PY-1 MAGI

Example:

IRS PY-3 = Level 2

Bene PY-1 = Level 1

IRS PY-2 = Level 0

IRS PY-1 = Level 1

SSA uses PY-2 MAGI and identifies the Overage

Send and IRMAA Annual Verification Overage Notice

Send T2R notice and refund the appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

SSA will not determine a higher IRMAA than that determined using PY-2. (Exceptions – Amended Return – HI 01120.045 and Corrected IRS Tax Information – HI 01120.050)

CMS notifies direct bill beneficiaries and refunds overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

If SSA Originally Used PY-2 MAGI and is now using Beneficiary Supplied PY-1 MAGI for the Current Year Determination and

  

IRS PY-1 MAGI is significantly higher than beneficiary provided PY-1 MAGI but significantly lower than original IRS PY-2

Example:

IRS PY-2 = Level 2

Bene PY-1 = Level 0

IRS PY-1 = Level 1

The IRMAA system will use IRS PY-1 MAGI to determine the IRMAA.

Identify the Arrearage

Send an IRMAA Annual Verification Predetermination Notice.

If no protest after 20 days, send an Annual Verification Correction Notice

Send T2R notice and collect the appropriate additional premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination.

IRS PY-1 MAGI significantly lower than IRS PY-2 MAGI validates the New Initial Determination.

IRS data is the standard in the law.

CMS notifies direct bill beneficiaries and collects premium arrearage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and collects premium arrearage.

SSA notifies RRB who notifies annuitant and collects premium arrearage.

IRS PY-1 MAGI is significantly higher than beneficiary provided PY-1 MAGI and significantly higher than original IRS PY-2 MAGI

Example:

IRS PY-2 = Level 2

Bene PY-1 = Level 1

IRS PY-1 = Level 3

SSA uses PY-2 MAGI and identifies the Arrearage

Send an IRMAA Annual Verification Predetermination Notice.

If no protest after 20 days from the date of the notice, send an Annual Verification Correction Notice

Send T2R notice and collect the additional premium or notify the other agency (CMS, RRB) of the new IRMAA determination.

SSA will not determine a higher IRMAA than that determined using PY-2 (Exception – Amended Return HI 01120.045 and Corrected IRS Tax Information – HI 01120.050)

CMS notifies direct bill beneficiaries and collects premium arrearage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and collects premium arrearage.

SSA notifies RRB who notifies annuitant and collects premium arrearage.

IRS PY-1 MAGI is significantly lower than beneficiary provided PY-1 MAGI and significantly lower than IRS PY-2 MAGI

Example:

IRS PY-2 = Level 3

Bene PY-1 = Level 2

IRS PY-1 = Level 1

The IRMAA system will use IRS PY-1 MAGI to determine the IRMAA.

Identify the Overage

Send an IRMAA Annual Verification Overage Notice.

Send T2R notice and refund appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

IRS PY-1 MAGI significantly lower than IRS PY-2 MAGI validates the New Initial Determination.

IRS data is the standard in the law.

CMS notifies direct bill beneficiaries and refunds overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.

IRS does not return PY-1 MAGI (SSN is returned) when beneficiary has provided PY-1 MAGI that resulted in IRMAA

Example:

IRS PY-2 = Level 2

Bene PY-1 = Level 1

IRS PY-1 = Level 0

SSA uses PY-1 MAGI to identify the Overage

Send an IRMAA Annual Verification Overage Notice.

Send T2R notice and refund appropriate premium amount or notify the other agency (CMS, RRB) of the new IRMAA determination

IRS PY-1 MAGI significantly lower than IRS PY-2 MAGI validates the New Initial Determination.

IRS data is the standard in the law.

CMS notifies direct bill beneficiaries and refunds overage.

SSA notifies CMS and CMS notifies OPM of IRMAA level change. OPM notifies annuitants of new IRMAA deduction change and refunds overage.

SSA notifies RRB who notifies annuitant and refunds premium overage.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0601130035
HI 01130.035 - Chart of Possible Results of Annual Verification Process - 08/30/2011
Batch run: 08/30/2011
Rev:08/30/2011