RS 01404.140: Development of Possible Erroneous or Duplicate Postings

changes
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~~Effective Dates: 05/28/2015 - Present~~
Effective Dates: 11/22/2017 - Present
TN 15 (05-15)
RS 01404.140 Development of Possible Erroneous or Duplicate Postings
A. How erroneous or possible duplicate postings occur
Erroneous or possible duplicate posting errors may occur because of an employer reporting error or an internal Social Security Administration (SSA) processing error.
Examples of types of reporting errors are:
* The employer changes payroll reporting agencies and both third party reporters submit W-2 wage reports to SSA. The employees usually receive one W-2 for the year and are unaware of the electronic filing error. In most instances, when wages are the same, the master earnings file (MEF) will show an offset with the net result as correct. If the wages reported by the two third- party submitters are not the same, we add the wages together, which results in inflated wages for that year. The employer should complete a W-2c Wage Report to correct this type of error. Field offices (FO) may refer employer wage reporting problems through the National Wage Reporting Processing System WRPS. (For wage reporting problems, see RS 01404.160.)
* An earnings modernization item correction (EMOD ICOR) was incorrectly processed resulting in negative posting or the Office of Central Operations (OCO) processed an internal correction resulting in a negative wage amount.
* An employer attempts to correct the wages for an employee but submits a W-2 instead of a W-2c.
* Prior to 1987, we assigned State and local employers a Social Security employer identification number (EIN) with the number “69” as the first two digits.
In 1987, we discontinued the special “69” numerical EIN prefix and we assigned all State and local employers new federal EINs by the Internal Revenue Service (IRS). During the conversion from the “69” EINs to the new EINs, reporting problems occurred because employers reported earnings under the “69” EIN and the new EIN for the same work.
* Employers reported the same earnings twice:
* under their assigned EIN;
* under an EIN that did not belong to them (e.g., transposed EIN);
* or reports were internally assigned an EIN.
B. Erroneous postings identified by an Employer Report Query (EARQ)
EARQ generates the following types of Erroneous Posting Alerts for years after 1977.
1. Negative earnings posted for employer
The following earnings postings generate an EARQ alert of Negative Earnings Posted for Employer:
* The Earnings Record shows a negative yearly total for an employer (EIN).
* Federal Insurance Contribution Act (FICA) Max not reached.
* If FICA Max is present in the year, the alert will not generate.
2. Negative self-employment posting
The following earnings postings results in EARQ alert of Negative Self-Employment Posting:
* The self-employment posting on SSA’s earnings record for a given year is negative.
* FICA Max not reached for the year in question.
* If FICA Max is present for the year, the EARQ will not generate the alert.
3. Multiple FICA postings
The following earnings situation results in an EARQ alert of Multiple FICA Posting for an employer for a given year (for a description of multiple FICA postings, see SM 00355.060):
* The MEF search identifies an EIN (or self-employment) with multiple positive postings in a single year (excluding tips). The EIN does not appear on the Annual Duplicate Posting List.
* If the earnings are self-employment (SE), the number holder (NH) does not report earnings amounts on a fiscal cycle (fiscal SE income reports have two postings in each year).
* The sum of the multiple FICA amounts does not equal the FICA Max.
* One of the alerted amounts does not equal the total yearly amount.
* The smaller posting must be at least 75 percent of the larger posting and result must be equal to or greater than the smaller posting.
* The amount is less than the FICA max after removing all postings for the EIN in question.
* Do not consider tips as duplicate postings if there are regular wages in the same year for the same EIN. If there are two tips posted for the same EIN then the alert will show.
* If there are more than two postings for the same EIN in the same year, only two postings will show along with the message: “Additional Postings Present for the EIN in Year – see DEQY.”
4. Possible erroneous posting for two different EINs with same earnings
The EARQ generates the alert Possible Erroneous Posting – 2 different EINs with same earnings when:
* The MEF search identifies two or more positive earnings reports for the same total amount, including excess Medicare, if present, but posted under two different EINs in a single year and the FICA Max is not attained.
* If FICA Max is present after removing one of the questionable postings, the alert will not generate.
* If we identify one of the EINs as a State and local EIN (69) and the other EIN is on the Office of Quality Assurance’s Possible Erroneous State and local list, this alert will not display. Instead, such a posting will alert as a Possible Erroneous State/local posting (see RS 01404.140B.4.a. in this section).
5. Possible Erroneous State/Local posting
The EARQ generates the alert Possible Erroneous State/Local posting for years from 1978 through 1983 when:
* Earnings are posted as a State and local EIN (69); and
* Earnings are also posted with a non -State and local EIN; and
* FICA Max has not been reached with the inclusion of the questionable earnings, i.e., the alert will not be generated if FICA Max was reached without considering or including the questionable posting.
6. Posted Medicare Earnings with Total Old-Age, Survivor, and Disability (OASDI) Earnings Less than Max
The EARQ will generate the alert Posted Medicare Earnings with Total OASDI Earnings Less Than Max when:
* Medicare earnings are posted; and
* The EIN’s OASDI wages are less than the OASDI maximum for the year, for both SE and regular wages.
NOTE: When an alert generates and the posted OASDI earnings (for both wages and SE) are less than $1.00 of the OASDI maximum for the year, no investigation is necessary. Clear the alert and continue processing the claim.
C. Procedure on erroneous and possible duplicate postings
Take the following action to resolve possible erroneous postings on the earnings record.
1. Review earnings record
Review the earnings record with the NH (or claimant).
2. Verify exception to development
Verify whether an exception to development exists per RS 01404.110C.
3. Year in question is prior to 1978
If the year in question is prior to 1978 then:
* Request feedback for the year
* Specify the need for all employers’ names and addresses.
* Provide all identifying information available for the NH.
* Review the feedback results with the NH (or claimant).
* If feedback does not resolve the issue and the posting is incorrect, develop for evidence of wages. Determine whether an exception to the Statute of Limitation applies per RS 02201.008.
* As appropriate, correct the earnings record or deny the request for correction.
4. Year in question is 1978 or later
If the year in question is 1978 or later then:
* Request a DEQY for the EARQ alerted year and the surrounding years, specifying employer name and address;
* Review the ERQY alerts and the DEQY with the NH (or claimant) advising of all alerted years;
* Ask the NH (or claimant) if the earnings record accurately reflects the NH’s employment. If it clearly appears to be to the NH’s or claimant’s advantage to agree with the earnings record or there is a question as to the validity of the NH’s statement, thoroughly question the NH (or claimant) and carefully review the DEQY to determine the earnings pattern. Did the NH work for the employer in question in other years? The name of the worker on the DEQY may be an indication of a scrambled wage situation on the earnings record. Earnings reinstatement history or internal adjustments shown on the DEQY may help identify the cause and solution for the erroneous posting. If there is doubt as to the NH’s statement agreeing with the posted earnings, request evidence of earnings.
* If the NH (or claimant) agrees with the earnings record, or an exception to development exists, document the claim, providing the year alerted and reason why the earnings record is correct. Do not develop further.
EXAMPLE: I agree with the 2002 posting for my late husband’s earnings record. He received two W-2s that year when his company changed agencies that prepared the payroll.
* If the year is beyond the Statute of Limitations, as appropriate, verify that an exception to the Statute exists per RS 02201.008. Take the action indicated below for the specific EARQ alert (RS 01404.140B.5. through RS 01404.140B.9.).
* If the year is beyond the Statute of Limitations, as appropriate, verify that an exception to the Statute exists per RS 02201.008. Take the action indicated below for the specific EARQ alert (RS 01404.140C.5. through RS 01404.140C.9.).
5. Negative earnings posted or negative self-employment income posted
Take the following action to correct negative postings for an alerted year:
* If you can readily determine what the correct amount of earnings should be based on the DEQY review and the NH’s allegation of wages or SE, correct the earnings record. The DEQY may reveal that we posted the correct earnings under a different EIN.
* If the DEQY indicates that we processed the negative posting through the EMOD ICOR system, review the ICOR history file to determine what the correct earnings should be. (A negative posting as the result of an EMOD ICOR action is rare because the EMOD ICOR system should not permit processing an earnings correction action that resulted in a negative posting.)
* Request evidence of the wages or SE income from the NH (or claimant) if you cannot determine the correct amount of earnings. This is a last resort since it should be apparent from a review of the earnings history, the DEQY, and the NH’s statements what the correct earnings should be.
* If we have not taken corrective action prior to the processing of the claim, do not process the claim with negative earnings on the earnings record. Take the appropriate corrective action for the employer in question to add earnings that result in zero earnings for that employer for the alerted year. Document the claims file and the EMOD ICOR action as the reason for the action. Develop post-adjudicatively to correct the earnings record.
* Process the claim as a partial award (for information on partial adjudication, see GN 01010.110).
6. Multiple FICA postings
Take the following action to resolve an EARQ Multiple FICA postings alert:
* Question the NH (or claimant) as to whether he agrees with the earnings posted for that employer for that year. The NH may not know why multiple postings occurred, but may know what the total earnings for the employer should be.
* If the NH states that the total earnings for the employer for that year are correct and a review of the NH’s earnings history for the years surrounding the alert appear consistent with the total earnings for the alerted year, accept the NH’s statement. Document the claims file as to the year of alert, the total earnings, and the NH’s agreement.
* If the NH (or claimant) states the alerted earnings for one or both of the postings do not belong to him, i.e.; disclaims the earnings for that employer and a review of the NH’s earnings history supports his allegation, accept the disclaimer (for information on accepting a statement disclaiming earnings, see RM 03870.060).
Develop the scrambled earnings postings and, as appropriate, move the earnings to the ESF (for information on scrambled earnings, see RM 03870.045 through RM 03870.062).
Notify the NH of the actions taken. Do not transfer the earnings to the ESF unless it is apparent the earnings in question belong to another NH or claimant.
* If the NH (or claimant) disagrees with the earnings record for the alerted year (it is not a scrambled earnings situation), consider requesting scouting to determine why the multiple postings occurred. If the scouting results correct the earnings record, notify the claimant of the actions taken to correct the record. As appropriate, partially adjudicate the claim per GN 01010.110. Correct the earnings record when you receive sufficient evidence.
* If scouting does not correct the earnings and an exception to the statute of limitations exists, which permits correction, request evidence of earnings and correct the earnings record as appropriate (for information on exceptions to the Statute of Limitations, see RS 02201.008).
* If you cannot take corrective action, document the claim with why you did not take action for the year of the alert and the reason.
7. Possible erroneous posting for 2 Different EINs with Same Earnings
Take the following action to resolve the EARQ alert Possible Erroneous Posting – 2 Different EINs with Same Earnings:
* Review the employers on the DEQY with the NH (or claimant) for the year in question. If the NH (or claimant) states the earnings for the alerted year are incorrect, that he or she did not work for one of the employers, or that the total earnings are correct but the employer names are incorrect, request scouting to identify the employer reports (see MSOM EM 022.002). This alert will identify situations where the same employer reported or SSA posted the same wages using different EINs. For example, two reports from the same employer; one using the assigned EIN and a second report with the EIN numbers transposed.
* If the scouting results correct the posting error, notify the NH of the actions taken to correct the earnings record.
* If the scouting results do not correct the earnings and an exception to the statute exists that permits correction, request evidence of earnings and as appropriate, correct the earnings record.
* In claims cases, if you cannot take corrective action, document the claim with the year alerted and the reason you were unable to take corrective action.
8. Possible Erroneous State/Local posting
Take the following action to resolve the EARQ alert Possible Erroneous State/Local posting:
* Discuss the alerted year with the NH (or claimant). If the State and local EIN (69) and federal EIN identified are not related to the same employer and the NH (or claimant) agrees with the posting, document the claims file that he worked for both employers.
* If the NH (or claimant) disagrees with the posting or the State and local EIN (69) is related to the federal EIN (the same employer reported under the State and local EIN and the federal EIN), request scouting to identify the employers and reporting. If scouting resolves the issue, notify the NH (or claimant) of the action taken.
* If scouting does not resolve the issue and an exception to the statute exists, which would permit correction of the earnings, request evidence of earnings and correct the earnings record as appropriate.
* If you do not take corrective action, document the claims file as to the alerted year, the earnings in question, and the reason you are not taking action.
9. Posted Medicare earnings with total OASDI earnings less than max
Take the following action to resolve the EARQ alert posted Medicare earnings with total OASDI earnings less than max:
* Discuss the alerted year with the NH (or claimant). Determine whether the NH (or claimant) agrees with the posting. Determine whether the FICA postings are too low and the NH should have had max earnings.
NOTE: Carefully review the earnings record for missing employers and for errors on the SE income posted (if applicable).
* Request scouting for the alerted year and the employer in question. In many cases, the employer was attempting to correct the earnings and Medicare amount but submitted a W-2 in lieu of a W-2c or completed the wrong fields on the forms for the earnings information. The scouting results may identify and correct the reporting problem. If so, notify the claimant of the action taken.
* If the NH (or claimant) agrees with the FICA (OASDI) total and indicates that the Medicare total is incorrect and scouting does not resolve the issue, request evidence of earnings for the year in question, if an exception to the statute exists that would permit correction.
* Correct the earnings record as appropriate.
* If you do not take corrective action, document the claims file identifying the alerted year, earnings in question, and reason why you did not take corrective action.

POMS Reference

RS 01404.140: Development of Possible Erroneous or Duplicate Postings