EXCEPTION: If we have appointed the Bureau of Indian Affairs as the payee and direct deposit is not possible, an automated one-time payment (A-OTP) directly to the Bureau of Indian Affairs for deposit into the child’s account.

After a payee establishes a dedicated account, subsequent past-due benefits that are 6 X (FBR + OSS) or less are not required to be deposited in the dedicated account. If the payee chooses to deposit the funds into a dedicated account, the payee must use the funds in the dedicated account for limited permissible expenditures. For more information about permitted expenditures from a dedicated account, refer to GN 00602.140.

• •

  Benefits due, but unpaid, that accrued prior to the month of payment effectuation;

• •

  Benefits due, but unpaid, that accrued during a period of suspension for which the individual was subsequently determined to have been eligible; or

• •

  Any adjustment to benefits that results in an accrual of unpaid benefits.

The payee may use benefits deposited into a dedicated account only for specific and limited expenses for the child. For more information about the payee requirements and responsibilities concerning these dedicated accounts, refer to GN 00602.140.

Past-due benefits deposited into a dedicated account are excluded from resources. Any accrued interest the account earns is excluded from income and resources. The payee may deposit additional smaller past-due benefits into the dedicated account. These benefits are also excluded from resources. For additional information on this resource and income exclusion, refer to SI 01130.601.

Effective for past-due benefits paid on May 22, 2006 or later, Section 7502 of the Deficit Reduction Act of 2005, P.L. 109-171, enacted February 8, 2006, changes the formula for determining when we pay SSI past-due benefits in installments.

If the past-due benefits equal or exceed 3 X (FBR+OSS) but do not exceed 6 X (FBR+OSS), after IA reimbursement and direct payment of representative fees, we must issue these payments in installments, but they do not require a dedicated account.

If the past-due benefits are greater than 6 X (FBR+OSS), after IA reimbursement and or direct payment of representative fees, we must deposit these payments into a dedicated account in up to 3 installments at 6-month intervals. The first and second installment payments cannot exceed 3 X (FBR + OSS) unless the technician documents the request for an additional amount on a Report of Contact when an individual has outstanding debts or expenses as described in SI 02101.020B.4. However, because of dedicated account restrictions, installment payments to dedicated accounts should only be increased for debts related to:

• •

  Medical treatment.

• •

  Education or job skills training; or

  If related to the individual's impairment:

• •

  Personal needs assistance,

• •

  Special equipment,

• •

  Housing modification,

• •

  Therapy, or

• •

  Rehabilitation.

For examples of approved dedicated account expenditures, refer to GN 00602.140F.

The system determines (after any prepayment review, IA reimbursement, direct payment of representative fees, and automated recovery of any outstanding overpayment) whether installments apply. The system sets EA and IN diaries, and sends E1 and I6 alerts notifying the FO that the past-due benefits are scheduled for A-OTP into the dedicated account. The system also generates an automated notice to the individual explaining the current installment payment and that we will issue the next payment in 6 months.

Generally, the required dedicated account notices are automated. If a case requires a manual notice, the notices are available in DPS.

If the system does not automatically offset a prior collectible overpayment, recover the overpayment from the individual's continuing SSI payments at the 10 percent recovery rate.

However, even though we must deposit the benefits into a dedicated account, installment procedures do not apply if the individual:

• •

  Has a medical condition that is expected to result in death within 12 months, or

• •

  Is ineligible at the time of payment and is likely to remain ineligible for the next 12 months.

If one of these exceptions applies, we deposit the entire amount into the dedicated account using the A-OTP process.

If benefits for the current calendar month, or a subsequent month, are included in the benefits subject to installments or dedicated accounts, the FO must use the A-OTP process to issue the current month, or a subsequent month's payment to the payee. In some instances, this action removes the case from the installment or dedicated account provision.

In both examples, the A-OTP may reduce the underpayment to less than 3 X FBR so that the installment provisions do not apply or less than 6 X FBR so that dedicated account provisions do not apply.

Effective November 2010, when the FO, or an automated interface adds a pending grant reimbursement code (GRC) to an SSR, the system holds the entire underpayment with a UPV:V until the IAR is processed. Reimbursement to the state occurs automatically, without FO involvement unless the case requires FO intervention or the case is an eIAR exception. For information on FO intervention cases, refer to SM 01311.662C. For eIAR exception cases, refer to SI 02003.023.

If a dedicated account is not required after IAR, direct payment for representative fees, and automated recovery of any collectible overpayment, we release the underpayment.

For installment procedures, refer to SI 02101.020.

• •

  Closed period of disability cases placed in PSY N07 (i.e., not disabled) do not require a dedicated account for a child under 18 with a representative payee, even if the payee files an appeal.

• •

  In medical cessation cases (CDRs), even when the individual appeals the cessation, the dedicated account rules stop at termination, unless we approve a request for benefit continuation. If benefit continuation applies, then dedicated account rules continue.

• •

  If an existing dedicated account is involved in a medical cessation case, the rules for the account cease, unless benefit continuation applies.

If a case goes into non-pay or suspense status during the installment process, the FO must issue the scheduled installment to the payee by A-OTP unless the individual is residing in a correctional institution. The case requires a manual notice. For instructions on the prohibition against paying installments to persons residing in a correctional institution, refer to SI 00529.001.

If the past-due benefits are equal to or greater than $15,000, the FO must complete the underpayment prepayment review as described in SI 02101.025. Use the Underpayment Processing (UOUP) screen through Direct SSR Update. For more information on the UOUP screen, refer to MS 00304.018.

Once the FO completes the prepayment review, select option 4 = Release Underpayment/Prepayment Review Completed or Title II Offset Involved from the UOUP screen. If the FO does not complete the prepayment review through the UOUP screen, the case will not be automated. If the case is automated, the system generates:

• •

  An underpayment verification code (UPV) of ‘V’;

• •

  A request that the State submit its request for reimbursement for IA within 25 days through the eIAR website.

  Once the State submits the request, the system will compute and issue the reimbursement amount, and process the remaining underpayment according to the priority of payment rules. If the system cannot issue the reimbursement automatically, it will post an I9 diary to the record which requires FO intervention;

  NOTE: 

  The system will not set the E1 alert or the EA diary until the IAR is resolved.

• •

  An E1 alert to the FO for the payee to establish a dedicated account; and

• •

  An EA diary indicating need for account establishment.

The system then determines whether the remaining underpayment requires a dedicated account and whether installments are required and changes the UPV field from a ‘V’ to ‘2’ or ‘B.’ When the payee has established the dedicated account, the past-due benefits should be direct deposited into the account by A-OTP, per SM 01311.660 and MS 00304.018.

Once the account is established, follow the procedures in SI 02101.010C.3. in this section.

The system releases the underpayment in installments, if required if a dedicated account is not required after IA reimbursement and or direct payment for representative fees. For an overview of the SSI underpayment system process, refer to SM 01311.660.

When there is a prior collectible overpayment on the record and there is direct payment of authorized representative fees, the systems priority of payment order is:

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  IAR payment

• •

  Direct Payment of Representative Fee

• •

  Recovery of Prior Overpayment

If the past-due benefits require a prepayment review, the FO should follow instructions in SI 02101.025. After the prepayment review, use the UOUP screen to release the underpayment using the appropriate option. Refer to MS 00304.018 and SM 01311.661.

The system determines if a dedicated account with installments applies. It sets the UPV to ‘B’ and issues an automated notice to the payee informing them to set up a dedicated account. The system also sets an EA diary with a 30-day maturity date. If the diary matures, the system generates an E1 alert to notify the FO that the payee must establish a dedicated account. The system sends follow-up alerts every 15 days thereafter until we issue an A-OTP to the dedicated account, resolving the diary.

Once the payee establishes a dedicated account for an individual who is disabled and provides the FO with the required information for the account (the name and address of the financial institution, the routing number, account number, account title, type of account, and the amount of money deposited to open the account), the FO should:

• •

  Have the payee or individual in direct pay sign and date the SSA-552 “Dedicated Account Use of Funds Statement.” A PDF version of the SSA-552 is available on the inFORM Library website to print. The SSA-552 is also available online. The technician can also send the link to the individual who needs to complete the SSA-552 through the eMailer program.

  NOTE: 

  For instructions on completing the SSA-552 statement, refer to GN 00602.140F.

• •

  Input the financial institution information (routing number, account number, etc.) using the One-Time Payment Address (UPOA) screen. For A-OTP rules for records with direct deposit to the dedicated account, refer to SM 01901.160.

After the payee has established a dedicated account, the amount of a subsequent underpayment determines whether we must deposit, may deposit, or may not deposit it into the dedicated account.

• •

  If the subsequent underpayment may be deposited, the system releases the underpayment and notice with language stating that it may be deposited into the dedicated account.

• •

  If the subsequent underpayment is equal to or greater than 3 X FBR+OSS, it is paid in installments.

• •

  If we have begun installments, we will add any ‘new’ underpayment to the next installment. The system releases a notice that explains the new underpayment and instructs the payee to contact the field office if they want the money paid directly to them.

If, after 30 days from the original notice explaining the requirement for a dedicated account, the payee has not established the account, follow instructions in “Determining the Need for a Successor Payee” GN 00504.100. Once the EA diary matures, the system generates an E1 alert to the FO to notify them that the record is still waiting for a dedicated account. The system generates follow-up alerts every 15 days until the EA diary is resolved.

June is the payee for their child, Jake, a 7-year old who has a disability. The SSI claim was filed on January 3, 2023. On October 22, 2024, the FO receives a favorable disability determination from DDS that the child has a disability as of January 3, 2023.

The FO knows that the child's past-due benefit will exceed 6 times the adjusted FBR plus any federally administered optional State supplements ($914 + 75 State supplement for 2023 and $943 +$75 State supplement for 2024). The FO conducts the prepayment review ($21,059 in past-due benefits for February 2023 – October 2024), completes the UOUP screen through Direct SSR Update, and enters the appropriate selection.

The system holds the past-due benefits, sets the appropriate UPV code and diary, and issues an alert, if necessary. No IAR or representative fees are involved. The automated notice is released to the payee explaining the requirements of a dedicated account.

After receiving the dedicated account notice, the payee visits the FO with the required financial institution information. The FO has the payee sign and date the SSA-552, Dedicated Account Use of Funds Statement, explaining the limited expenditures authorized from this account.

The FO transmits the financial institution information on the UPOA screen and issues the first installment payment of $3,054 by A-OTP into the account. This resolves the EA diary. The system establishes an IN diary to indicate the next installment payment is due.

Two months prior to the second installment payment, June visits the FO to request $1,500 to purchase special equipment that is related to Jake’s impairment. The technician documents June’s request for the additional underpayment installment amount on a Report of Contact and issues an A-OTP to June to purchase the special equipment.

Jean is payee for their child, Ross. Jean filed an SSI claim for Ross on February 3, 2024. On November 27, 2024, the FO receives a favorable DDS disability determination that Ross has a disability as of February 3, 2024. Ross attained age 18 on September 2, 2024.

The FO determines that Ross needs a payee. Although the past-due benefits exceed 6 times the FBR + OSS, because Ross attained age 18 prior to SSA issuing a determination they are eligible for past-due benefits, the past-due benefits are not subject to the dedicated account requirements, but we must pay them in installments.

Therefore, after prepayment review, if the underpayment is $15,000 or more, the FO adjudicates the case to pay and the system releases the past-due benefits in installment payments to the representative payee, along with an award notice.

The FO receives a favorable disability determination from the DDS on November 25, 2024 that Matt, who is ten years old, has a disability as of February 11, 2024. Matt's parent is selected as the payee.

Although there is an IAR, the FO believes the past-due benefits may still exceed 6 times the FBR + OSS, after we have paid the State. After we receive the SSA-L8125-F6 from the State and issue an A-OTP for the IAR, the past-due benefits no longer exceed 6 times the FBR + OSS. Therefore, a dedicated account is not required. If installments apply, the system releases the first installment to the payee and sets the UPV to ‘2’ to control for the next installment.

The installment payment requirement applies when an individual (or eligible couple) is eligible for past-due SSI payments and the payment amount equals or exceeds three times the current maximum Federal Benefit Rate (FBR) plus any federally administered State supplement after reimbursement for interim assistance (IA) or direct payment of representative fees.

In applying this formula, we subtract any overpayments or penalties we withhold from the past-due SSI payments. For instructions on determining the amount of past-due SSI payments, refer to SI 02101.020C.6. and SI 02101.020D.8. in this section. For the exception to priority of payment order when there is a prior overpayment and payable representative fees, refer to SI 02101.002.

Installment payments are not required for an individual who, at the time of the past-due payment eligibility determination or during the installment process:

• •

  Has a medical condition which is expected to result in death within 12 months; or

• •

  Is no longer eligible for SSI and is determined likely to remain ineligible for the next 12 months.

If an individual meets one of the two conditions, pay the past-due amount in full.

We must pay installment payments in no more than three payments. We issue each installment payment at six-month intervals. If we do not release the second installment timely, we must wait six months after the second installment to release the third, and final, installment. Each of the first and second installment payments cannot exceed three times the FBR plus any federally administered State supplement, unless the exceptions in SI 0210.020B.4. for increasing the installment amount applies. The first and second installment payments should each be for the maximum FBR amount when the balance due equals or exceeds 3 X FBR, plus State supplement). The third, and final, installment payment is the balance of the past-due benefit.

If the individual, or their representative payee (payee), alleges they have debts or expenses as described in SI 02101.020B.4. in this section, we will increase the amount of the first or second installment.

A dedicated account is required if the individual is under age 18, has a payee, and the past-due amount (after Interim Assistance Reimbursement (IAR), representative fee payments, and prior overpayment collection) is greater than six times the FBR plus any federally administered State supplement. Because installment payments are required if the past-due amount equals or exceeds three times the current FBR plus any federally administered State supplement, any case that meets the dedicated account requirement also meets the installment payments requirement. Establish the dedicated account before releasing any past-due payments. For instructions on dedicated accounts, refer to SI 02101.010.

When members of an eligible couple both become eligible at the same time, determine if a case requires installment payments using the couple's FBR, plus any applicable, federally administered State supplement. However, when only one member becomes eligible while the other member's claim is pending, use the individual's FBR, plus any applicable federally administered State supplement, to determine if the case requires installment payments for that member of the couple.

When the second member of the couple becomes eligible, one-half of the couple's rate applies in determining whether the case would require installment payments if that member is due an underpayment. This does not affect the first member's installment payments.

Each installment payment retains a nine-month exclusion period following the payment receipt month. For retroactive SSI and RSDI payments, refer to SI 01130.600. Do not consider the unpaid installment balance a resource. Exclude dedicated account installment payments indefinitely as a resource.

The system holds the underpayment when a pending GR code is on the SSR. Conduct the prepayment review to send the electronic accounting record to the State and set the UPV of “V”. When the State certifies the interim assistance (IA) payment amounts, the system determines the reimbursement due and releases the past due payment following the priority of payment order. If the case meets an exception to eIAR, refer to the instructions in SI 02003.025.

Installment payments are determined after we reimburse the State for interim assistance or for the direct payment of any representative fees. If the authorized representative elects direct fee payment, refer to the instructions in:

• •

  Administering Representatives Fees Provisions - GN 03920.000

• •

  Fee Authorization Under the Fee Petition Process - GN 03930.000

• •

  Fee Authorization Under the Fee Agreement - GN 03940.000

We may deduct an overpayment for a different period from the unpaid balance of the past-due installments after we give the individual due process rights for the overpayment and the appeal period has expired. The system automatically offsets an overpayment against the past due installment when we release the first, second, or third and final payment.

• •

  IAR payment

• •

  Direct Representative Fee Payment

• •

  Prior overpayment recovery. Refer to GN 03920.000, GN 03930.000, GN 03940.000, and SM 01901.000.

Any additional past-due SSI payments that become payable during the installment period become part of the installment process. An automated notice informs the individual we will add the additional underpayment to the next installment payment. The individual must contact the field office (FO) to receive this money sooner. The FO needs to send an A-OTP, using the UPOT screen from the UPSP Menu, only for the additional past-due amount.

For individuals in the FLA D living arrangement ($30 cap), the threshold when making the determination for paying past-due installments is an amount that equals or exceeds three times the current FBR, plus any federally administered State supplement, i.e., for 2024, 3 X FBR of $943 plus any applicable State supplement.

The installment payment process continues at six-month intervals for a maximum of three payments until we paid the past-due amount in full, unless the individual meets an exception in SI 02101.020B.2. When an individual is in a non-pay or suspense status, issue the installment payments using the A-OTP process and send manual notices, unless the individual resides in a correctional facility as described in SI 00529.001 and SI 02101.020D.3. in this section.

If the individual dies prior to receiving all past-due payments, refer to SI 02101.002 to determine who is eligible for the decedent's remaining past-due SSI payments.

If payments for the current calendar month, a subsequent month, or both are included in the amount subject to installments, issue an A-OTP for the current month or subsequent month or both. In some instances, this action removes the case from the installment provisions.

Take this action only after any prepayment review of large underpayments as described in SI 02101.025, adjustment for IAR calculation, or adjustment for direct attorney or non-attorney fee payment, and collectible overpayment from a different period.

EXAMPLE 1: If we effectuate the SSI claim on August 15th, the current computation month is September and the first monthly payment would be issued September 1st.

We treat all due amounts through August as an underpayment subject to the installment provisions if the underpayment is more than three times the FBR. The FO must issue an A-OTP for August, the current calendar month.

EXAMPLE 2: If we effectuate the claim after the current computation month cutoff in August, the current computation month is October, and we issue the first monthly payment on October 1st. Treat all payments due through September as an underpayment, subject to installment payment requirements if the underpayment is more than three times the FBR. In this situation, the FO must pay the current calendar month’s payment (August), and September’s payment by A-OTP. The FO will issue a manual notice when paying the current or subsequent month by an A-OTP. In both examples, the A-OTP may reduce the underpayment to less than three times the FBR, removing the underpayment from installment payment requirements.

For performing the prepayment review, follow the instructions in SI 02101.025. To release the underpayment after the prepayment review, use the Underpayment Processing (UOUP) screen through DIRECT SSR Update. For more information about the UOUP screen, refer to MS 00304.018. Choose the appropriate underpayment release code.

After we make the IAR payment to the State, pay representative fees directly, and recover any prior overpayment. The system determines whether installment payments or dedicated accounts apply. The system also generates the appropriate notices if a dedicated account is required.

As long as an underpayment (UPX) remains on a record, the system does not automatically terminate the record. However, in cases where the record has terminated (e.g., T31, T32), manually control the case until we issue all past-due payments. If you erroneously terminate the record (T30, T33), manually control the case until we issue all past-due payments. If the individual is no longer eligible for SSI and is determined likely to remain ineligible for the next 12 months, refer to SI 02101.020B.2 in this section.

The No Social Security Benefits for Prisoners Act of 2009 (NSSBP) prohibits paying SSI underpayments to individuals or terminated individuals who are prisoners, confined in a public institution based on a court order for a criminal act, fugitive felons, or probation or parole violators. For instructions on processing incarcerated claimants and individuals’ underpayments, refer to GN 02607.550, SI 00529.001, and SI 00529.020.

The system issues installment payments in only a few non-pay situations when a record goes into non-pay status. Control and issue installment payments using the A-OTP process and send manual notices in any case where the system does not release the payment, unless the individual resides in a correctional facility. For instructions on processing incarcerated claimants and individuals’ underpayments, refer to SI 00529.001 and MS 00303.007.

When SSA pays authorized representative fees directly, and a prior overpayment is on the record, the priority of payment order is:

• •

  IAR payment;

• •

  Direct representative fee payment;

• •

  Prior overpayment recovery.

If the individual is likely to remain ineligible for SSI (or becomes ineligible during the installment process) or the medical condition will likely result in death within 12 months:

• •

  Complete a prepayment review, if applicable, according to SI 02101.025.

• •

  Document the file on a Report of Contact showing the reason for issuing one payment rather than installments.

• •

  Select Option 5 on the UOUP screen to indicate the case meets an installment exception and the prepayment review is complete. The system releases the underpayment via the automated payment process. For more information about the UOUP screen, refer to MS 00304.018.

If an individual becomes ineligible during the installment process and is likely to remain ineligible for at least 12 months, or if the individual informs the FO that their medical condition will likely result in death within the next 12 months and requests the remaining past-due SSI payments, issue the remaining past-due amount.

EXCEPTION: We cannot pay underpayments or retroactive Title XVI payments to claimants, individuals, or terminated individuals while they are residing in a correctional institution, confined in a public institution based on a court order for a criminal act (CPICO), a fugitive felon (FF), or in violation of probation or parole (PPV). For more information about the No Social Security Benefits for Prisoners (NSSBP) Title XVI Provisions, refer to SI 00529.001.

For guidance when considering whether there is an expectation that an individual's medical condition will result in death within 12 months such as a terminally ill case (TERI), refer to DI 23020.045. When determining whether an individual is likely to remain ineligible for 12 months or more, consider the facts involved in the case.

The first or second installment payment may be increased by the amount of the individual’s outstanding debt or expenses under the conditions described in SI 02101.020B.4.

The amount by which we increase the payment cannot exceed these “approved” debts or expenses. The individual may request an increase to the installment payment at any time.

Let the individual know what the exceptions are to the limit on the amount of the first and second installment payments during the PERC interview, and explain the kinds of outstanding debts or current or anticipated expenses that are acceptable expenses for increasing the installment.

When the individual requests an increased installment payment because of outstanding debts or expenses as described in SI 02101.020B.4., record on a Report of Contact or SSA-5002 the individual or payee's:

• •

  Request for an increased installment payment amount; and

• •

  Allegation of the type and amount of debts or expenses as described in SI 02101.020B.4.

  Issue DPS notice Instal 05 - App/Disapp Request for Increased Payment.

When past-due payments greater than six times the FBR, plus any federally administered State supplement, are due an individual under age 18 who has a payee, in addition to requiring a dedicated account, the past-due payments must also be paid by installments. We pay all dedicated account cases by installments via direct deposit into a dedicated account. For the permitted expenditures and requirements of a dedicated account, refer to the instructions in GN 00602.140 and GN 00603.025. If an exception to installments applies as the described in SI 02101.020B.2, deposit the entire past-due amount into the dedicated account.

Prior overpayments are offset against the first, second and third (final) installment payment(s) automatically. Due to systems limitations, we cannot offset in all dedicated account or installment payment cases. If the system does not offset a prior overpayment, continue collecting the overpayment at the 10 percent rate.

For more information administering representative fee provisions, refer to GN 03920.000. For more information about the fee petition process, refer to GN 03930.000. For more information about the fee agreement process, refer to GN 03940.000. For more information about the A-OTP process, refer to SM 01901.000.

If we are making installment payments and the technician inputs a change for a subsequent period that creates an additional overpayment, DO NOT OFFSET the overpayment against the installment payments.

After all overpayment due process rights for the overpayment, including waiver issues, are complete, apply a collect decision to the record (D TAC), and recover the overpayment from any installment funds that have not been paid.

If we have not completed due process, or the individual requests a waiver, issue the last installment payment timely and recover the overpayment via 10 percent withholding from continuing payments.

Automated netting is part of the computational process. Netting takes place prior to placing the installment or dedicated account indicator on the record. However, once we place the installment or dedicated account indicator on the record, automated netting does not take place.

When the individual receives installment payments and the technician inputs a change for a subsequent period in which higher payments are due for some months and lower payments are due for other months, allow the system to create a B3, unresolved overpayment diary, for months of excess payment and add the additional amounts due the individual to the installment total.

After we release the overpayment notice and there is a collect decision on the record (D TAC), and installment funds remain, the system recovers the overpayment if the appeal period has not lapsed, or if there is a waiver request, we cannot recover from the installment payment. If these issues are not resolved before we make the final installment payment, recover the overpayment through 10 percent withholding from continuing payments.