TN 11 (01-22)

GN 02301.020 Title II Underpaid Beneficiary is Alive

A. How we discover underpayments

SSA’s systems detect most underpayments due a living beneficiary. If the system cannot pay an underpayment automatically, the office that detects the underpayment is responsible for issuing the payment and notice. For more information on Title II underpayment notices, see GN 02301.010.

B. Procedure for issuing the underpayment

When issuing an underpayment to a living beneficiary, remember:

  • The beneficiary does not need to request payment of an underpayment they are due.

  • Issue the underpayment with any amount currently payable directly to the beneficiary unless the beneficiary has a representative payee.

  • After issuing the underpayment, annotate the Special Message field on the Master Beneficiary Record (MBR) to include the date, amount, and reason for the underpayment.

  • If the beneficiary has a representative payee, but requests to be paid directly, reevaluate the beneficiary’s capability following the guidelines in GN 00502.055. If found capable, issue the underpayment to the beneficiary.

  • If there is a need for payee change or successor, develop for a representative payee following instructions in GN 00504.100, then issue the underpayment to the new payee.

  • Issue the underpayment by direct deposit, if available. If the beneficiary or representative payee does not have direct deposit, issue the underpayment by check.

  • If the underpaid beneficiary also has an overpayment, we may withhold part or all of the underpayment to recover the overpayment. For policy on adjustment of underpayments for an overpaid beneficiary, see GN 02210.006.

  • The underpayment should remain in the Special Payment Amount (SPA) field on the MBR until all necessary development is complete.

IMPORTANT: The Social Security Act prohibits paying any retroactive benefits, including underpayments, to beneficiaries while they are prisoners, fugitive felons, or probation or parole violators (with certain arrest warrant offense codes). SSA must hold retroactive benefits until the beneficiary contacts SSA and provides proof that they are no longer a prisoner, fugitive felon, or a probation or parole violator. For policy on fugitive felons and probation or parole violators, see GN 02613.000.

1. When benefits are in a current pay status

When benefits are in a current pay status, issue the underpayment to the beneficiary or to the representative payee on behalf of the beneficiary (if applicable) using current MBR information.

2. When benefits are in a terminated status or benefits are being reinstated after a period of suspense or termination

Issuing an underpayment when benefits are in a terminated status, being reinstated after a period of suspense, or reinstated after a period of termination requires development for verification of current direct deposit and address. In addition, confirm any representative payee change or change to self-payee.

a. Benefits in a terminated status

If entitlement to benefits has terminated:

  1. 1. 

    Contact the beneficiary using DIRCON procedures outlined in GN 01070.305 and GN 01070.315 through GN 01070.320;

  2. 2. 

    Verify the identity of the beneficiary per GN 00203.020A.2;

  3. 3. 

    Obtain a current address and bank data for direct deposit (if available); and

  4. 4. 

    Issue the underpayment to the beneficiary or to the representative payee on behalf of the beneficiary (if applicable).

b. Benefits being reinstated after a period of suspense or termination

If benefits are being reinstated after a period of suspense or termination:

  1. 1. 

    Verify a current address and bank data for direct deposit (if available); and

  2. 2. 

    Issue the underpayment to the beneficiary or to the representative payee on behalf of the beneficiary (if applicable).

c. Beneficiary requires a representative payee

If the beneficiary requires a representative payee, follow payee development procedures outlined in GN 00504.160 before issuing the underpayment.

C. Procedure for returned underpayment checks

If a check for $50.00 or more is returned and cannot be processed by the Returned Check Action (REACT) Program, develop following the procedure outlined in SM 00624.030B. If a check for less than $50.00 is returned and cannot be processed by REACT, post the underpayment to the SPA field of the MBR. Annotate the Special Message field on the MBR to state, “Underpayment posted to SPA – payment returned.” Take no further action unless SSA receives a request for payment of the underpayment from an eligible recipient.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0202301020
GN 02301.020 - Title II Underpaid Beneficiary is Alive - 01/26/2022
Batch run: 01/26/2022
Rev:01/26/2022