Complete the SSA-632-BK todetermine if the overpaid person meets the requirements
for waiver approval under the defeat the purpose waiver provision.
Complete form SSA-632-BK. See SI 02260.005 for instructions. We included form SSA-4641, Authorization for Social Security
to Obtain Account Records from a Financial Institution and Request for
Records, on page 12 of the SSA-632-BK.
If SSI eligibility continues and current countable monthly income is less than:
The $20 general income exclusion; plus
The $65 earned income exclusion; plus
NOTE: Do not consider other income disregards (i.e., those used for computation purposes).
The federally administered State supplementary level
Then find defeat the purpose of title XVI of the Act.
If SSI eligibility continues and the individual’s total countable income is more than
the amount in SI 02260.005B.1.a,
2. No current SSI eligibility or deemed defeat the purpose of title XVI of the Act does
If there is no current SSI eligibility or the provisions of deemed defeat the purpose
of title XVI of the Act are not applicable, find that recovery would defeat the purpose
of title XVI of the Act if:
The individual needs substantially all current income to meet current ordinary and necessary living expenses; and
Recovery would reduce the total resources (as defined in GN 02250.115 through GN 02250.130) below $3,000 for an individual without dependents or $5,000 for a person with one
dependent. Allow an additional $600 for each additional dependent.
Remember: If you determine the requirements for defeat the purpose of title XVI of the Act
are not met, you may still waive recovery if you determine that recovery or adjustment
would be against equity or good conscience. See SI 02260.025
3. Spouse-to-spouse deeming
Determine the amount, if any, of deemable income from the ineligible spouse.
NOTE: This is the calculation you would do if you had to calculate type “V” unearned income.
See SM 02101.010.
If there is no income to deem to the liable overpaid individual, do not include the
spouse’s income in your deemed defeat the purpose of title XVI of the Act determination.
If the income deemed from the ineligible spouse lowers the eligible individual’s SSI payment:
Calculate the liable overpaid individual’s payment using only his or her own income.
Add the ineligible spouse’s deemed income to the eligible individual’s own income.
Subtract the $20 general income disregard.
If the result is greater than the individual FBR, the requirements to establish deemed
defeat the purpose of title XVI of the Act are not met.
For system instruction on spouse-to-spouse deeming, see SM 02101.010.
4. Development of possession of incorrect payment
Possession of incorrect payment
Recovery will not defeat the purpose of title XVI of the Act to the extent the liable
individual has in his or her possession any of the incorrect payment(s) or proceeds
identifiable as from such payments in liquid resources.
Determining that the liable overpaid individual possesses the overpaid funds or identifiable
proceeds from the overpaid funds can be very difficult. Therefore, accept the individual’s allegation that he or she does not possess overpaid funds (or the identifiable proceeds from
the overpaid funds), unless it is obvious from the record that the individual does
in fact possess all or part of the overpaid funds.
EXAMPLE: A liable individual who was overpaid $1,200 requests waiver of his or her overpayment.
The individual provides the FO with his or her bank statements. After examining the
statements you determine that $200 of the overpayment is included in the statements.
Even if you determine that the individual is without fault, you can not waive $200
of the overpayment because the liable individual retains $200 of the overpayment in
his or her bank account.
NOTE: You can not use waiver tolerance to waive the remaining $1,000 of the overpayment
because the total overpayment is $1,200. See SI 02260.030C
For additional information on how to determine whether the liable individual has possession
of all or part of the overpayment, see GN 02250.105.