TN 42 (11-23)

RS 02501.120 Prorating Work Suspensions

A. Policy for prorating work suspensions

1. Prorating rules

  1. a. 

    Prorate work suspensions if the beneficiary submits a written request. The prorated period is at the beneficiary’s option but:

    • Cannot begin earlier than the month of the request;

    • Cannot extend beyond June of the following year; and

    • The amount payable (before supplementary medical insurance deductions) must be at least $25 per month.

  2. b. 

    Prorating may be extended into the following year only if:

    • the beneficiary alleges that loss of benefits will cause financial hardship (the type of financial hardship usually associated with the recovery of an overpayment is not necessary to grant a request for prorating work suspensions); or

    • the loss of benefits would require the beneficiary to make a significant revision of a retirement plan; and

    • there is no expectation of excess earnings for the next year.

  3. c. 

    The allegation must be in writing but does not need verification.

2. When proration cannot be granted

Do not prorate work suspensions if the individual has any existing overpayment. If the beneficiary is overpaid, prorating of work suspensions must be stopped.

NOTE: Incorrect payments during the current year because of earnings are not overpayments. Overpayments caused by excess earnings can only be determined after the close of that taxable year.

B. Field office and program service center actions

1. Field office actions

  1. a. 

    Assist the beneficiary in making the written request for proration or deferral of work suspensions.

  2. b. 

    If the request for proration extends into the following year, in addition to the allegation of financial hardship or the change of a retirement plan, obtain the beneficiary's written statement that:

    • They have no expectation of excess earnings in the following year; and

    • They understand that benefits in the following year will be withheld; and

    • They must report any change in expected earnings; and

    • Any overpayment will cancel the prorated withholding and the estimated withholding amount

  3. c. 

    Compute the estimated monthly withholding. (For procedures to compute the proration, see RS 02501.125.)

  4. d. 

    Fax the request form SSA-795 (Statement of Claimant or other Person) into paperless to the servicing program service center (PSC) for processing.

  5. e. 

    Annotate the request with a special tag marked "Prorated Work Suspension-Priority Handling.”

2. Program Service Center actions

  1. a. 

    Hand carry the material tagged "Prorated Work Suspension-Priority Handling" to the module for processing.

  2. b. 

    Review the request to insure that no overpayment exists on the record and that the material meets all other criteria.

  3. c. 

    Process approved requests.

  4. d. 

    Notify the beneficiary of the action taken because of the request. Include the exact withholding rate for approved requests. For denied requests, notify the beneficiary and explain the reason for denial. Do not include the reconsideration paragraph since this is not an initial determination and does not carry appeal rights.

3. Recomputation subsequently involved

Prorating of work suspensions will have no effect on Adjustment in Reduction Factors (ARF) and Delayed Retirement Credit (DRC) recomputations. For such recomputations, use only the correct number of full or partial deduction months based on actual earnings without regard to benefits paid under a request for prorated work suspensions.

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RS 02501.120 - Prorating Work Suspensions - 11/09/2023
Batch run: 11/09/2023