SSR 78-5: TREATMENT UNDER THE SUPPLEMENTAL SECURITY INCOME (SSI) PROGRAM OF REISSUED TITLE II BENEFITS WHEN PAYEES ARE CHANGED

(PPD-11)

SSR 78-5

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.

02(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.

igible

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.