TN 19 (04-24)

SI 02006.010 Title II Offset and SSI Changes

A. Policy - SSI Overpayments and Underpayments

1. Why a Special Formula?

  1. a. 

    After the offset has been applied, the FO may discover that the offset was computed based on incorrect SSI data. This means the offset amount may be incorrect.

  2. b. 

    When a change affects the SSI computation for months in the offset period, or the number of months in the period (a DOE change because of a protective filing statement or “reopening” of a prior SSI claim), the FO must consider the offset that was imposed (the recovery that has been made) and the offset that should have been imposed (the recovery that should have been made based on the change) to make a correct overpayment (OP) or underpayment (UP) determination.

  3. c. 

    By issuing the true UP, or collecting the true OP:

    • We leave the person with the total amount of SSI and title II they would have received if we had paid them correctly to begin with.

    • The U.S. Treasury and the States expend the same amount they would have paid had we done all computations using the correct benefit amounts initially.

2. Event Affects 1 of 2 Months Before Offset Period

An SSI change that affects either of the 2 months preceding the offset period requires a computation of the true OP/UP. This is because it may change the SSI amount that was due in the offset period.

3. Event Affects Eligibility for Month Before Offset Period

A change of the individual's SSI eligibility status for the month prior to the beginning of the offset period requires a computation of the true UP/OP. It changes when the “transitional computation cycle” applies (see SI 02005.050), so it changes when the retroactive title II income would have reduced SSI benefits.

4. Zero Offset

An individual may be subject to the offset with an offset amount of zero. This occurs when the retroactive title II period is only 1 or 2 months, the 2-month retrospective computation of SSI benefits applies, and the individual is ineligible for SSI after the last month of the retroactive period.

5. Negative Offset

  1. a. 

    It is possible that an individual would have been due more SSI for some months in the offset period if we had paid the retroactive title II on time. No UP is due because a UP must be based on the income the recipient actually received, not on what they would have received had we paid the title II when due.

  2. b. 

    For any month for which more SSI would have been due, there is a “negative offset amount.

    • If the individual would have been due more SSI for every month had we paid the title II on time, the offset amount for each month is set to zero.

    • If there is a positive offset amount for some months and a negative offset amount for other months, combine them. If the negative amounts exceed the positive amounts, the offset amount for each month is set to zero. If the positive amounts exceed the negative amounts, the difference is the offset amount for the offset period.

    • See SM 01320.206 and SM 02101.230

B. Operating Policy - Formula for Computation of True OP/UP

1. Net Payment

  1. a. 

    The “net payment” takes into consideration that we recovered SSI payments.

      SSI paid

    - Offset amount

    Net payment

  2. b. 

    If the offset is zero, then the SSI paid = the net payment.

  3. c. 

    If the offset amount is negative, subtract the negative amount from the SSI paid; e.g., $100 SSI paid minus negative $10 = $110.

2. Net Amount Due

This is the amount of SSI the person would have been due had we paid the title II income on time, based on the correct SSI information. It takes into consideration the SSI payments we should have recovered.

3. True OP/UP

  Net payment

- Net amount due

  True OP (If positive)

  True UP (If negative)

C. Example

1. Facts

  • SSI DOE = January 1989;

  • Offset period = February - October 1989;

  • Monthly title II = $320

2. Offset Amounts

Mo. Offset
February 0
March - October 300 per mo.

3. SSI Event

  1. a. 

    FO discovers individual was subject to the value of the one-third reduction (VTR)in March - May 1989.

  2. b. 

    If the individual had received the retroactive title II benefits on time, they would have had $320 title II income in March, April, and May in addition to the VTR in each of these months. The individual would have been ineligible because of excess income for these 3 months.

  3. c. 

    The true OP, caused by the change in income, is for the period March - May.

4. Step 1: Net Payment

3/89 4/89 5/89
$368 Paid $368 Paid $368 Paid
-300 Offset -300 Offset -300 Offset
$ 68 Net paid $ 68 Net paid $ 68 Net paid

$68 per month is the net payment considering the SSI amount that we recovered by applying the offset.

5. Step 2: Net Amount Due

3/89 4/89 5/89
$368.00 FBR $368.00 FBR $368.00 FBR
-300.00 FCI* -300.00 FCI* -300.00 FCI*
-122.66 VTR -122.66 VTR -122.66 VTR
$ 0 Net due $ 0 Net due $ 0 Net due

*($320 title II - $20 general exclusion)

These are the amounts due using the correct income information, including the title II income due in each month ($320), as unearned income. The net amounts due are zero: had we known the correct income information when the offset was computed, we would have recovered the total SSI benefits due for March through May.

6. Step 3: True Op

3/89 4/89 5/89
$68 Net paid $68 Net paid $68 Net paid
- 0 Net due - 0 Net due - 0 Net due
$68 True OP $68 True OP $68 True OP

7. Summary

  1. a. 

    The true OP period is March through May. The true OP is $204.

  2. b. 

    The true OP of $204 is less than the OP that would have existed ignoring offset.

    • Ignoring offset, the OP period would have been May, June, and July, because the SSI benefits for those months would have been the SSI benefits affected by VTR in March, April, and May.

    • The amount paid was $1104 ($368 x 3), the amount due was $736.02 ($245.34 x 3), and the OP would have been the difference: $367.98.

D. Description of System Capabilities

See SM 01320.600. For most cases, the SSI system will compute the true OP or UP. It will do this by using the information from the payment history (PMTH) segment (the amount paid) and the WCMP segment (the offset amount and the amount that would have been due had we paid the title II income on time).

E. Operating Procedure

If the SSI system cannot compute reliably the true OP or UP, the FO must do the computation manually.

1. Find the Offset

Find the offset amounts on the SSA-4346-U2 (SSI Offset Summary).

2. Find the Retroactive Title II Amounts

Find the monthly retroactive title II amounts in Section I., item C. of the SSA-4345-U2 (Record of Telecon — SSI Offset Case). These amounts are also in the benefit history field of an MBR query; the history field shows the months for which (not in which) the benefits are due.

3. Worksheets Unavailable

If you are unable to locate an offset worksheet in the servicing FO, contact the PC that has the SSI recipient's title II claim to obtain the offset amount information.

  • Request the information from the PSC's by using the “Field Office Request for Action-Information.” (See GN 02606.000) Request the information from the Office of Disability Operations (ODO) either by using the “Field Office Request” or phone.

  • If you request offset information in writing, state clearly at the beginning of the request that the title II claim involves title II offset. This notation will assist routing of the request.

4. Document the Manual Computation of the True OP or True UP

  1. a. 

    Record or document the offset amounts in the SSI file.

  2. b. 

    Complete all parts of the SSA-8108 (“SSI Overpayment and Disposition Determination”).

    • Enter the net SSI payment in the right-hand column. Change the column-heading to “was actually paid—less offset-recovery.”

    • Enter the net amount due in the left-hand column. Change the column-heading to “should have been paid—less offset recovery.”

    • The difference is the true OP or UP.

5. Retain Documentation

  1. a. 

    For some cases, the FO must make an input to the SSR so it will post the true OP or release the true UP. This involves transmission of “action codes” to the CO field of the SSA-1719B (“SSI Posteligibility Input”). Follow the instructions in SM 01320.600 ff.

  2. b. 

    After transmitting this SSA-1719B, the servicing FO must retain it with the offset worksheets and SSI queries. (See GN 02610.055B. for retention requirements.)

  3. c. 

    If the SSI recipient's servicing FO changes, transfer both the offset worksheets and the SSA-1719B for that claim to the new servicing FO.

6. Notices

  1. a. 

    If the true OP/UP = 0, do not send an OP or UP notice;

  2. b. 

    If the offset has no effect on the amount of the OP/UP, prepare a notice as usual. Do not refer to the offset. Follow the instructions in NL 00803.010 and NL 00803.015 if there is an UP.

  3. c. 

    If the offset has an effect on the amount of the OP/UP, prepare a notice that refers to the offset involvement. Follow the instructions in NL 00803.010 and NL 00803.015.

    • State the true OP/UP (computed considering the effect of the offset) as the overpaid/underpaid amount.

    • State the months in the period of OP/UP that are within the offset period.

    • Explain that to determine the OP/UP, you considered the amount that was withheld from title II benefits and the amount that should have been withheld.

NOTE: Follow the special notice procedures in NL 01001.010 if the notice will be sent to a claimant, beneficiary, or representative payee who alleges being blind or visually impaired.

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SI 02006.010 - Title II Offset and SSI Changes - 04/15/2024
Batch run: 04/15/2024