TN 17 (06-94)

GN 02201.033 Handling Postoffset/Postcertification Inquiries

A. Introduction

Generally, inquiries will be received after certification of cases to IRS (i.e., after the certification run in December or early January) or after actual offset has occurred. In the majority of these cases, the debtor simply failed to contact us to resolve the repayment issue as specified in the preoffset notice. There are other situations, however, where certification to IRS may have been incorrect. This section explains how to handle specific postoffset/postcertification inquiries.

B. Procedure

1. Allegation of pending protest, waiver or hearing request

If a debtor alleges that he/she filed a protest or requested waiver or hearing but never received a decision, obtain a ROAR query and proceed as follows:

  1. a. 

    If there is a 23W, 23R, or 23H posted but no decision code:

    • Refund any amount offset by IRS.

    • Look for an SSA-632-BK, a letter from the debtor or his/her representative or a Form SSA-795 in FO records or in the claims folder.

    • Process the waiver/protest in accordance with GN 02201.034 or GN 02201.036.

IMPORTANT: The PC will process all TRO refunds.

  1. b. 

    If ROAR reflects an unfavorable reconsideration, waiver or hearing decision:

    • Advise the debtor that since the issue has been resolved, TRO was appropriate.

    • Do not refund any amounts offset by IRS.

  2. c. 

    If there is no ROAR posting but the debtor still indicates a prior protest, waiver, or hearing was filed:

    • Look for an unprocessed SSA-632-BK, letter or SSA-795 in FO records or in the claims folder.

    • Check DMS remarks for evidence of the request.

    • Refund offset amount and reestablish the debt if the records review reveals a protest/waiver/hearing was filed prior to certification.

    • Post the pending request to ROAR via the DRPR or DPRF screen if offset has not occurred.

    • Advise the debtor if the records review fails to produce any evidence of a precertification protest, waiver, or hearing.

    • Follow 2. below if the debtor wishes to file a new waiver request.

2. Request for waiver

If a request for waiver is received, proceed as follows:

  1. a. 

    Obtain an SSA-632-BK in accordance with current instructions in GN 02250.002 and GN 02250.200.

  2. b. 

    If TRO recouped the entire debt (i.e., the debt balance is zero), proceed as follows:

    • Consider waiver on the entire overpayment amount, and

    • Follow GN 02201.034 to process the waiver.

    • Advise the debtor that refund of the amount offset will be made only if waiver is approved.

    • Refund any monies due if waiver is approved (partially or fully).

  3. c. 

    If TRO partially recouped the debt, proceed as follows:

    • Consider waiver on the outstanding balance unless the debtor asks for waiver for the full overpayment amount.

    • Follow GN 02201.034 to process the waiver.

    • Refund any monies due if waiver is approved.

3. Request for installment payments

When a request for installment payments is received, proceed as follows:

  1. a. 

    If an installment agreement was negotiated prior to certification and payment was made in accordance with that agreement but IRS offset still occurred, refund the amount offset.

  2. b. 

    If the request is made after certification, proceed as follows:

    • Input the manual installment agreement via the Record Installment Agreement (DRIN) screen (MSOM DMS 006.014).

    • Advise the debtor that offset could still occur because SSA has no control over the IRS offset operation. Explain that SSA will not refund any offset monies (unless excess collection, see 4. below. The installment agreement will apply to the debt balance remaining after offset).

4. Excess collection

If a certified debtor enters into an installment agreement and makes a payment, or makes full refund after certification, excess collection can occur when IRS offsets for the full amount of the debt.

If one debtor is on the record, refund the excess amount under existing instructions.

If more than one debtor is on the record and the system posted the excess collection to that other debtor, an “unverified offset alert” is generated to the PC. If this occurs, proceed as follows:

  • Refund the excess collection to the TRO debtor.

  • Remove the other debtor from the Recovery and Collection of Overpayment Process (RECOOP) system if the other debt was loaded as a result of the posted excess refund. Correct the other debtor's overpayment balance.

5. Erroneous offset due to incorrect BOAN

If the FO discovers the incorrect BOAN, report the case to the PC so that it can be deleted from TRO.

If the PC discovers the incorrect BOAN, report the case to the OAS staff.

Provide the claim number, debtors' name and both the correct and incorrect BOANs in the report.

Correct the MBR once the correct BOAN is determined.

Refund the erroneous offset to the person due the IRS refund.

6. Erroneous offset to a joint taxpayer

When couples file joint tax returns and the party that is not an SSA debtor wishes to receive his/her portion of the refund, advise the person to contact his/her local IRS office. This is known as an “injured spouse claim” which IRS alone can adjudicate. Advise that any refund must be made by IRS, not SSA.

C. Examples

Following are case examples of common postoffset and post-certification situations.

1. Timely protest resolved prior to certification

A debtor contacted us in September and provided documents he felt would show that the debt does not exist. In November, the PSC advised him that his case was reviewed and the overpayment does exist. The debtor has taken no further action until contacting us in early February to say that he has been refused a rapid refund.

Explain that our referral to IRS for collection was proper. If there is a balance after the IRS offset and he now wishes to pay that balance via full refund or negotiate an installment agreement, we will accept it. And, we will not return the offset monies to him unless the total repaid money exceeds the amount of the overpayment or he requests waiver which is subsequently approved.

2. Alleged nonreceipt of preoffset notice

  1. a. 

    Undeliverable Notice Posted to TRO

    A debtor calls us in March complaining that IRS has informed him that $500 of his refund has been offset to repay a debt to SSA. He says he never received his pre-offset notice.

    The TRO query shows an undeliverable notice posted on March 5. Explain both the TRO process and the existing overpayment to the debtor. Also explain that we received the returned notice from the post office too late to stop the offset, but we will take action to refund the money withheld by IRS if the debtor wishes it. If the debtor wants the money returned to him, establish how he wishes to repay or protest the debt.

  2. b. 

    No Undeliverable Notice Entry on TRO

    The same situation as above, except the TRO query does not have an undeliverable notice entry.

    Explain that we have a record of all notices returned as undeliverable by the Postal Service and his notice was not returned. When the notice has not been returned, we must assume that it was delivered and proceed under the provisions for debt collection under TRO. Explain that we must keep the money collected by IRS unless he establishes that: 1) the debt does not exist; or 2) he has no liability for repaying the debt; or 3) recovery of the debt is waived; or 4) he provides clear and convincing evidence that the letter was never delivered. He may pursue any of these options, but no money will be refunded unless SSA reaches a favorable decision based on the information he provides us.

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GN 02201.033 - Handling Postoffset/Postcertification Inquiries - 11/09/2012
Batch run: 10/26/2023