TN 18 (11-08)

A. Background

Occasionally, there is a need to ask the Department of the Treasury (DT) to abandon (reverse) a reclamation request. This can occur when an erroneous death or erroneous date of death is posted to the beneficiary’s or recipient’s record. Although the payee was alive and actually due the payment(s), DT reclaims the money based on our incorrect E-stop input for each check issued after the alleged date of death.

To stop DT from processing the reclamation on the bank account, we send DT an abandon reclamation request.

If the error is realized before the money is reclaimed from the financial institution (FI), DT tells the FI to ignore (abandon) the reclamation request.

If the error is realized after the money is reclaimed, the abandon reclamation request authorizes DT to reverse the reclamation and reimburse the bank for the money improperly reclaimed.

B. Procedure for situations requiring abandon reclamations

1. Erroneous date of death

A date of death is sometimes input in error (beneficiary/recipient is not deceased) or the beneficiary/recipient is deceased but the wrong date was input. Checks may be cashed that the beneficiary or recipient was entitled to, but because incorrect death information posted to the record, the funds were reclaimed from the presenting bank.

EXAMPLE 1: Mr. Jones died on 03/12/08, but his date of death was incorrectly input as 01/12/08. Because E-stops posted to his record for the February and March 2008 payments, his bank was debited for those two checks. Mr. Jones was entitled to those checks and received the funds. The bank is out the money and should be reimbursed by SSA by processing an abandon reclamation. We request an abandon reclamation for the two checks using the form found in this section at GN 02408.302D.

EXAMPLE 2: Mr. Smith contacted us on 03/25/08 to provide his new address. Mr. Smith's benefits were terminated with an erroneous death input. Mr. Smith received his 04/03/08 check and cashed it at his bank. Because we erroneously terminated Mr. Smith's benefits, an E-stop (death) posted to his record for the 04/03/08 check and DT reclaimed the funds from the bank. The bank, in turn, debited Mr. Smith's account. We should request an abandon reclamation for the 04/03/08 check using the form found in this section at GN 02408.302D. DT reverses the reclamation and returns the money to the bank. The bank credits the money back to Mr. Smith's account.

2. Preventing erroneous underpayment release when correcting Title XVI erroneous date of death

When a Title XVI erroneous date of death causes payments the recipient is due to be reclaimed incorrectly, the payments may or may not post to the SSR by the time we realize the error.

Before we ask Treasury to abandon reclamation, we review the SSR carefully to determine if the credit for the reclamation is posted. Credits for the reclaimed funds are posted in PMTH in payflag 3 as an “S” and in payflag 5 as an “R”.

a. When the credit is posted for improperly reclaimed funds, prevent the release of an erroneous underpayment.

• Post a “U TAC” on the recipient’s SSR.

• Process an abandon reclamation request per GN 02408.302C in this section.

NOTE: Posting the “U TAC” prevents the release of an erroneous underpayment to the recipient after Treasury processes the abandon reclamation. When the “U TAC” is not posted, an erroneous underpayment is released to the recipient making him or her overpaid.

b. When the credit is not posted, process an abandon reclamation request per GN 02408.302C in this section.

3. Checks cashed that were issued after death of the beneficiary/recipient

Occasionally in incorrect payment after death situations, DT reclaims the funds from the FI and the family member who cashed/deposited the check(s), thinking the deceased was due the money, also returns the money to SSA. The following scenarios occur:

• The FI debits the account for the amount reclaimed, sometimes causing checks to be returned for insufficient funds.

  NOTE: Although penalties or overdraft fees may be assessed to the account because of insufficient funds, SSA has no mechanism for paying these fees. Often the bank waives the fees if we call and explain what happened.

• A family member protests stating he or she has repaid the amount to SSA.

• The bank does not debit the account, but calls SSA and requests that we return the amount reclaimed because we have already received the money back from the family member.

Request an abandon reclamation by using the form found in this section at GN 02408.302D.

IMPORTANT: DT asks that we return the funds by completing and emailing the abandon reclamation form to them. DT prefers that the funds return through the same channel in which they were initially obtained. In normal abandon reclamation scenarios, DT does not want us to issue a special payment to the FI.

C. Procedure for abandoning a reclamation request

To abandon reclamation, provide DT with the all of the information requested on the SSA-1714-OP1:

• the check number and symbol;

• the name and SSN of the beneficiary/recipient;

• the date and amount of the check; and

• the reason for abandoning the reclamation.

Use the exhibit in this section at GN 02408.302D. to abandon a reclamation.

1. Title II/Title XVI – FO/RO/PSC

Complete and email the exhibit in this section at GN 02408.302D. to Bureau of the Fiscal Service (Fiscal Service) at pfc-reclamations@fms.treas.gov.

2. Title II PC Only

After making the abandon reclamation request, code the SSA-4208 to update the Accounts Receivable System (ARS). For SSA-4208 instructions, see SM 00609.875.

D. Exhibit

The FO, RO, or PC uses the form SSA-1714-OP1 to abandon a reclamation for Title II or Title XVI check payments.

To abandon a reclamation request for Title II or Title XVI payments made by direct deposit, see GN 02408.800.