The claimant may request to change his or her method of reporting to:

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  Increase the earnings for insured status or benefit computation purposes, or

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  Decrease the earnings for deduction purposes.

SSA should inform the claimant of his or her right to change the method of reporting only if a change in reporting will affect:

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  Insured status, or

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  Date of entitlement, or

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  SSA development has reduced NESE below the amount that may be reported under the option. See RS 01803.160 and RS 01803.180 for optional methods of reporting.

If adjustments are made which reduce the reported NESE below the amount that may be reported under the optional method, the claimant must be advised of any advantages that could be derived by electing the option.

The effects of the option must be considered in cases where it appears that the reported SEI should be adjusted.

If the change to or from the optional method was considered:

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  Document the file to show that the optional method was discussed.

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  Inform the claimant if the change in method of reporting will increase the number of deduction months.

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  Advise the claimant of the additional tax liability that could be incurred if the option is elected and if the additional tax would offset the increase in monthly benefits. See RS 01801.100 for Tax Liability Table.

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  Notify IRS via ICOR (MSOM EM 010.001 for a discussion of ICOR processing) when initiating a change in method of reporting for the claimant.

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  Require a copy of an amended tax return if the claimant alleges that he or she changed his or her method of reporting to the optional method.