PURPOSE: To revise current policy concerning the treatment of conserved title II funds when such funds are returned to the Social Security Administration (SSA) for reissuance to a payee for, or directly to a individual (or couple) eligible for SSI payments.
CITATIONS (AUTHORITY): Section 205(j), 1612 and 1613 of the Social Security Act, as amended; Regulations No. 4, Section 404.1610, Regulations No. 16, Sections 416.601, 416.680, 416.1105, 416.1180, and 416.1201.
PERTINENT HISTORY: Previously conserved title II funds, which were returned to SSA when the payee changed, had been counted as unearned income (in the quarter of reissuance) when reissued to the new payee or directly to the SSI beneficiary. However, this policy of counting the reissued conserved funds as income resulted occasionally in the same funds being counted as income on two different occasions, and the persons eligibility for SSI payments was affected when there actually was no change in the amount of income. This policy was based on the definition of income as found in section 416.1102(a) of the regulations. Income is defined as the receipt by an individual (or couple) of any property or service which can be applied directly or by sale or conversion to meeting his needs for food, clothing, or shelter. Conserved funds directly transferred from the previous payee to a new payee are presently treated and will continue to be treated as a resource for title XVI purposes.
POLICY DIRECTIVE STATEMENT: This revision of policy applies only to those conserved title II funds that have been returned to SSA for reissuance to a new payee or to an eligible individual (or couple). Those conserved title II funds returned to SSA for reissuance will continue to count as a resource to the individual (or couple) under title XVI of the Social Security Act. Such funds will not be counted as income when reissued to a new payee or directly to the eligible individual (or couple) provided such conserved funds were previously considered as income or a resource in determining eligibility for, or the amount of the eligible person's payment under title XVI. For the conserved title II funds to continue their status as a resource upon reissuance to a new payee, or to the individual (or couple), the funds must have been previously considered under the title XVI provisions as either income or as resources in determining the beneficiary's eligibility for, or the amount of, payment under the SSI program.
In some situations, checks issued to a new payee or directly to the eligible individual (or couple) may include title II funds which were not previously used in determination of eligibility and computations under title XVI. This could have occurred where retroactive disability benefits were never previously issued (and thus never counted as income or resources) pending an initial or reconsideration determination that a disability exists. In determining payment amounts, funds not previously counted must be included as unearned income in the quarter of issuance when they are issued for the first time for or to the eligible person(s).
DOCUMENTATION: SSA records that previously issued title II funds being reissued do not include funds which were not previously "counted" as income or resources in determination and payment computations under title XVI.
FURTHER INFORMATION: In those cases where title II payments are suspended pending development of a new payee, title XVI payments are continued to the individual (or couple) if at all practicable. In the computation of title XVI payments during the period of suspension, the amount of the suspended title II checks will not be counted as (unearned) income.
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