SI 02220.016 Supplemental Security Income Overpayment - The Ten Percent Rate of Adjustment

CITATIONS:

Social Security Act §1631(b)(1)(B); 20 C.F.R. §416.570,416.571

A. Introduction

Following a determination that an overpayment exists and after we have issued notice of the overpayment to the overpaid individual or their eligible spouse, we must recover the overpayment by adjusting future Supplemental Security Income (SSI) payments to the overpaid individual or their eligible spouse, and adjust any past-due payments if certain conditions are met, unless we approve a request for a waiver. If waiver of adjustment or recovery is not applicable (see SI 02220.015B.1), we will recover the overpayment at the lesser of the monthly SSI payment or 10 percent of the individual’s total monthly income, unless the individual requests a different rate of recovery or another exception applies. For additional information refer to SI 02220.016C.2 in this section.

B. Policy for the ten percent rate of adjustment

Compute the rate of adjustment:

For an individual: the initial overpayment notice, whether generated by the automated overpayment notice system (AONS) or manually produced, proposes a rate of adjustment of the monthly SSI payment that is the lesser of:

•

Ten percent of the sum of the overpaid individual's countable income used to compute the current payment, and the Federal and State amounts due the individual for the current computation month (CCM); or
•

The individual's actual monthly payment amount.

For an explanation of the income used in the payment computation refer to SI 02005.001.

For a member of an eligible couple propose a rate of adjustment of the monthly SSI payment that is the lesser of:

•

Ten percent of the sum of one-half of the couple's monthly income used to compute the current payment, and the Federal and State amounts due the overpaid member of the couple for the CCM; or
•

The actual monthly amount for the overpaid member.

Use this computation to calculate the proper adjustment rate whether one or both members are overpaid.

NOTE: In spouse-to-spouse deeming, the computation compares the payment the member would be due as an individual and the payment due as an eligible couple. The ten percent adjustment rate changes as the basis for payment changes from individual computation to couple computation. This can produce unusual swings in the rate of adjustment, especially when the Livermore rules apply, refer to SI 01320.430.

For individuals and couples: the budget month income will not equal the income used to compute the monthly payment when cost of living (COLA) coordination applies, refer to SI 02005.010.

C. Procedures for the ten percent rate of adjustment

1. Applying the ten percent rate

a.

Apply the ten percent only to cases where the payment status is C01 (current pay).
b.
Change the rate to ten percent when:
- •
  
  An overpaid individual returns to current pay status following a period of ineligibility or suspension, and
- •
  
  The withholding rate established was higher than ten percent.

2. Exceptions to applying the ten percent rate

a.

If the overpaid individual is subject to the $30 payment limit for Federal living arrangement (FLA) D do not enforce withholding. Accept any refund(s) offered. Complete the MSSICS Overpayment Decisions (UOPD) screen by selecting RECOVER BY CHECK ADJUSTMENT. This will build a Recovery by Check Adjustment Decision (D TAC) in the Overpayment Decision Date (OPDD) segment. Adjustment may begin with the first month the individual is no longer subject to the payment limitation for FLA D, refer to SM 01310.400 and SM 01311.105B. This also allows the withholding of underpayments due to individuals in FLA D for months earlier than the current calendar month in order to reduce outstanding overpayments, refer to SM 01310.410.
b.

If recovery by adjustment is not possible because the individual is not in current pay, the ten percent rate of adjustment is not applicable. Negotiate the rate of recovery through an installment agreement if the overpaid individual is not currently receiving a Title II benefit, refer to SI 02220.025B.2. If the individual is currently receiving a Title II benefit, cross program recovery (CPR) may be applicable, refer to SI 02220.020.
c.

If the overpaid individual requests a rate of adjustment that is higher or lower than ten percent, refer to SI 02220.026.
d.

When the overpaid individual received payments under the conditional payment provision propose a rate of recovery of up to 100 percent. Refer to SI 01150.203A.2.h. Negotiate a lower rate if the 100 percent rate would mean the individual is unable to afford ordinary and necessary living expenses (food, clothing, shelter, and medical care).
e.
There are a number of other exceptions, though not all relate directly to overpayments. The following are situations when 100 percent withholding is required:
- •
  
  Offsetting because the overpaid individual used burial funds for another purpose, per SI 01130.410.G, SI 01130.410C.5, and SM 01311.310.
- •
  
  The Office of the Inspector General (OIG) Office of Investigations or the Department of Justice (DOJ) has determined that the overpayment was the result of fraud, per SI 04070.020, GN 02201.055 and GN 04123.005.
- •
  
  The Claims Specialist (CS) or higher makes a determination that the liable person or their deemor committed similar fault, misrepresentation, or concealment of material information, refer to GN 04060.055 and SI 04070.020.
  
  A similar fault determination must be a formal written determination prepared by a CS or higher. Consider all the factors listed in SI 04070.020B when making your determination.
f.
The following are situations where withholding at the rate of 100 percent may be appropriate:
- •
  
  The U.S. Department of the Treasury has determined that the individual received both the original and replacement SSI payments, resulting in a double check negotiation (DCN) overpayment, refer to GN 02250.021 and GN 02406.300.
- •
  
  A Civil Monetary Penalty (CMP) is imposed, refer to GN 02230.050.
  
  Penalty assessments and deductions are distinct issues from adjustments to recover overpayments. Collect any reporting penalty assessed prior to recovering an overpayment. Refer to SM 01311.305, SI 02301.105.A, and MS 00304.016. To determine if 100 percent withholding may be appropriate, refer to GN 02250.021.

3. Notification when recovery rate is 100 percent

•

Notify the overpaid individual in a Notice of Planned Action that the overpayment recovery will be at the 100 percent rate and the reason why we must withhold 100 percent; and
•

Increase the recovery rate to 100 percent.

D. Examples of different rates of adjustment

1. Individual in FLA A

Toni Doze is due a Federal SSI payment of $994.00 (the FBR for April 2026). Toni has no other income. The proposed recovery rate is $99.40.

Dollar Amount	Recovery Rate Calculation
$994.00	SSI Payment
$0	Countable Income
$994.00	SSI Payment
$994.00	Total
$994.00 ÷ 10 =	$99.40 is the recovery rate

2. Individual Subject to the VTR (FLA-B)

Dan Shaw is in FLA-B, subject to a one-third reduction (VTR) of $331.33. Dan is due a Federal SSI payment of $662.67 for May 2026. The proposed recovery rate is $99.40

Dollar Amount	Recovery Rate Calculation
$662.67	SSI Payment
$331.33	Countable Income (VTR)
$994.00	Total
$994.00 ÷ 10 =	$99.40 is the recovery rate

3. Individual's SSI Payment is Less Than the 10 Percent Rate

Don Acuna is due a Federal SSI payment of $50.00 for April 2026 based on the budget month's countable income of $944.00. Because 10 percent of the sum of the countable income and the amount due exceeds the SSI payment, the proposed reduction rate will be $50.00 (the entire SSI payment).

Dollar Amount	Recovery Rate Calculation
$50.00	SSI Payment
$944.00	Countable Income
$994.00	Total
$994.00 ÷ 10 = $99.40 which is greater than the SSI payment	$50.00 is the recovery rate

4. Eligible Couple

John and Jane Boswell are considered an eligible couple for SSI. In April 2026, each is due an SSI payment of $745.50, and a federally administered optional State supplement (OSS) of $100.00. Each has an outstanding overpayment. The proposed monthly recovery rate cannot exceed $84.55 each. Although the couple rate is $1691.00, the recovery rate is determined separately for each individual.

Dollar amount	Rate of Recovery
$745.50	SSI Payment
$100.00	OSS Payment
$845.50	Individual SSI and OSS combined payment amount
$845.50 ÷ 10 =	$84.55 is the recovery rate because it is less than the combined SSI and OSS payment

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SI 02220.016 - Supplemental Security Income Overpayment - The Ten Percent Rate of Adjustment - 05/08/2026
Batch run: 05/08/2026
Rev:05/08/2026

Program Operations Manual System (POMS)