TN 50 (10-06)

Citations:

Social Security Act, §1612(b)(3) as amended by P.L. 108-203, §430;

20 CFR 416.1112(c)(2), 416.1124(c)(6), 416.1161(a) and 416.1161(c)

A. Definitions

1. Infrequent income beginning September 8, 2006

Income is considered to be received infrequently if an individual receives it only once during a calendar quarter from a single source and the individual did not receive that type of income in the month immediately preceding that month or in the month immediately subsequent to that month, regardless of whether or not these payments occur in different calendar quarters.

2. Infrequent income prior to September 8, 2006

Income is considered to be received infrequently if an individual receives it no more than once in a calendar quarter from a single source.

3. Irregular income

Income is considered to be received irregularly if an individual cannot reasonably expect to receive it.

4. Single source of income

a. Earned income

A single source of earned income is an employer, a trade, or a business.

b. Unearned income

A single source of unearned income is an individual, a household, an organization or an investment. Examples of a single source of unearned income are as follows:

• A household in which an individual lives is a single source even if the household composition changes due to a move by the individual or by other household members (see SI 00810.410F.2.).

• An organization is the Federal Government, a single State or local government, a business or corporation, a charitable agency, or a similar entity which provides an individual with income.

• An investment is a single financial account, life insurance policy, rental property, or any other resource providing a return to its owner. Two separate accounts, even if with a single financial institution, are two different investments.

5. Two payments from a financial institution – not a single source

An individual may occasionally receive an irregular interest payment by reason of a financial institution's own internal “housekeeping” rules. For example, a bank's rules may require an extra payment when someone closes an account or there may be a special “adjustment” payment due to a change in the accounting system or to closing the books at the end of a fiscal year. These kinds of irregular payments are from the financial institution itself and not from an individual's account with that institution. Therefore, they do not cause a regular (but infrequent) interest payment from an account to be considered “frequent” in that one quarter (see SI 00810.410F.3.).

NOTE: Determinations involving sources of income are only necessary when determining whether income is infrequent (see SI 00810.410F.1. and SI 00810.410F.2.).

6. Types of unearned income

For purposes of this exclusion, types of unearned income are those listed in SI 00830.160, SI 00830.210 through SI 00830.555 and in-kind support and maintenance (ISM) as described in SI 00835.000.

7. Outside ISM – not a type of unearned income

For only the purposes of this exclusion, outside ISM should be treated as if it is the corresponding type of unearned income listed in SI 00830.210 through SI 00830.555 (e.g., gift, child support). It requires evaluation of contributions from each source separately if frequency is at issue.

B. Policy – general

1. The exclusion

We exclude income which is received either infrequently or irregularly. In order to be excluded, the income need only be one or the other (infrequent or irregular).

2. Application of the exclusion

a. Applicable to both earned and unearned income

• Benefits payable beginning July 1, 2004

This exclusion applies to earned and unearned income up to the limits in SI 00810.410C. and SI 00810.410D.

• Benefits payable prior to July 1, 2004

  This exclusion applies to both earned and unearned income provided the total of each does not exceed the limits in SI 00810.410E. We excluded all infrequent or irregular earned and/or unearned income or none of it, depending on the amount involved.

b. Limit as it applies to couples

• The dollar amount of the exclusion does not increase even if both an eligible individual and spouse (eligible or ineligible) have infrequent or irregular income.

• When determining whether income received by an eligible couple meets the definition of “infrequent,” consider each individual’s income separately. If both members of a couple receive a paycheck of $400 only in February, both paychecks are considered infrequent. The exclusion is applied to the first paycheck received.

c. To whom applicable

The exclusion is applicable to income received infrequently or irregularly by an eligible individual, eligible or ineligible spouse, ineligible parent(s), and ineligible children.

3. Unearned income – specific considerations

In evaluating frequency of receipt of unearned income, we look at receipts of the same type of income from a single source.

C. Policy – benefit payments beginning september 8, 2006

Beginning September 8, 2006, infrequent income is defined as income that an individual receives only once during a calendar quarter from a single source, and which the individual did not receive in the month immediately preceding that month or in the month immediately subsequent to that month, regardless of whether or not those payments occur in different calendar quarters.

We exclude the following amount of income which is received either infrequently or irregularly:

• The first $30 per calendar quarter of earned income; and

• The first $60 per calendar quarter of unearned income.

NOTE: If an individual begins receiving a recurring payment (e.g., a social security check) in the third month of a quarter, the payment does not meet the definition of infrequent because it will be received in the following month, even though the following month is in another quarter. The same would be true if the recurring payment ended in the first month of a quarter, but had been received in the prior month in another quarter.

D. Policy – benefit payments between July 1, 2004 and September 7, 2006

Between July 1, 2004 and September 7, 2006, infrequent income was defined as income that an individual received no more than once in a calendar quarter from a single source.

We exclude the following income which is received either infrequently or irregularly:

• The first $30 per calendar quarter of earned income; and

• The first $60 per calendar quarter of unearned income.

NOTE: If an individual begins receiving a recurring payment (e.g., a social security check) in the third month of a quarter, the payment does meet the definition of infrequent. It does not matter that the individual receives the payment in the following month, since that month is in another quarter. The definition in effect during this period only requires that the payment be received no more than once in a calendar quarter from a single source. Also, a recurring payment that ends in the first month of a quarter meets the definition of infrequent.

E. Policy – benefit payments prior to July 1, 2004

We exclude income which is received either infrequently or irregularly provided the total of such income does not exceed:

• $10 per month of earned income; and

• $20 per month of unearned income.

NOTE: The definition of “infrequent” during this time period is the same as in SI 00830.420D.

F. Examples of types and sources of unearned income

1. Each of two types of income from a single source is infrequent

In July 2004, an individual's friend repays, with interest, money the individual had loaned him. The interest income is $50. In August 2004, the same friend gives the individual a gift of some football tickets with a value of $100. The individual has received two different types of income — interest and a gift — from the same source. Evaluating each receipt separately, we see that each can qualify separately as infrequent. The first $60 is excludable even though the total received exceeds $60. The infrequent or irregular income exclusion would reduce the $50 interest income in July to zero and the remaining $10 exclusion would reduce the value of the tickets to $90.

2. Inside ISM from two households is not infrequent

An individual lives in one household at the beginning of a calendar quarter and receives inside ISM. In the second month of the quarter, he/she moves to a different household from which he/she also receives ISM. Since we consider both households to be a single source, the ISM does not qualify as infrequent.

3. Regular source makes unexpected payment

An individual has a savings account that pays interest of $15 in the second month of each quarter. The interest has been routinely excluded as infrequent as the individual has no other infrequent or irregular income.

In 2003, without any advance notice to depositors, the bank changes its accounting system. As a result, in June the individual receives a $2.03 one-time payment in addition to his/her regular $15 interest payment in May.

The bank does not intend to interrupt its usual quarterly interest schedule, so the CR correctly views the one-time payment in June as being from a separate source than the regular quarterly payments; i.e., it is a bank adjustment. Therefore, the regular $15 payment is still excludable as infrequent while the unexpected $2.03 payment is irregular. The total is within the $20 limit in the month of receipt and is excludable.

NOTE: A similar situation exists when SSA makes an AERO payment during a month each year in addition to the regular recurring title II check. Since an AERO payment cannot reasonably be expected or budgeted for, it meets the definition of irregular income and is subject to the $60 infrequent or irregular income exclusion beginning July 1, 2004.

4. ISM and institution

An individual was confined in jail on May 31^st and released on August 15^th. The CR correctly values the food and shelter received by Mr. Hamilton from the jail at the PMV for all months June through August. The ISM cannot be excluded as irregular because the individual could have reasonably expected to receive the food and shelter while incarcerated. The income cannot be excluded as infrequent income because the ISM was received in consecutive months. The fact that the individual was ineligible for SSI in June and July is not material to the irregular and infrequent determination.

5. Receipt of same type of income from more than one source

The individual receives wages from three different employers during September 2008. He receives $60 from Kmart on September 1, $75 from Wal-Mart on September 5, and $100 from a Mobil gas station on September 20.

He received no wages in July, nor did he receive wages in August or October 2008 (the months preceding and following the month he received wages). Consider all three-wage payments infrequent income. Apply the $30 earned income exclusion to the Kmart wages since the individual received the Kmart wages first.

NOTE: If the exclusion exceeds the amount of the wages received first, apply the remainder of the exclusion to the wage received second. We apply the exclusion to wages in order of receipt until the wages reach the exclusion limit or there are no more wages in the month.

G. Process – identifying infrequent or irregular income

1. Unearned income

a. Benefit payments beginning September 8, 2006

b. Benefit payments July 1, 2004 through September 7, 2006

c. Benefit payments prior to July 1, 2004

2. Earned income

a. Benefit payments beginning September 8, 2006

b. Benefit payments July 1, 2004 through September 7, 2006

c. Benefit payments prior to July 1, 2004

H. Process – applying the exclusion

1. Benefit payments beginning July 1, 2004

The following process is for any earned income but only for unearned income which is not subject to other exclusions.

2. Benefit payments prior to July 1, 2004

The following process is for any earned income but only for unearned income which is not subject to other exclusions (see SI 00810.410O.).

I. Procedure – general

1. Initial claims

a. Infrequent

If income is regular but may qualify for exclusion as infrequent, evaluate its receipt over the quarter of filing, including any months prior to filing.

b. Irregular

If income may qualify for exclusion as irregular, evaluate the predictability of its receipt beginning with the month of application.

2. All situations

a. Individual’s allegation

Obtain a statement signed or recorded on a DROC concerning the type, amount, frequency, or predictability of income. The statement, or similar information on the SSI application or redetermination form, is sufficient documentation. Absent evidence to the contrary, accept the individual's allegation.

b. Evidence disagrees with allegation

If there is evidence which disagrees with the individual's allegations, develop and document under the appropriate income rules.

J. Procedure – amount of income for benefit payments beginning July 1, 2004

1. Earned income

Determine all of the earned income received on an infrequent or irregular basis during the calendar quarter and exclude the first $30. If the first infrequent or irregular earned income received results in PSY N01 (excess income) in a month, the $30 exclusion must still be applied to this income even if the PSY remains N01. Similarly, if the first infrequent or irregular earned income is received in a month of non-pay during the quarter (e.g., NO4, N22, etc.), the $30 exclusion must still be applied to this income which was received first.

2. Unearned income

Determine all of the unearned income received on an infrequent or irregular basis during the calendar quarter and exclude the first $60. If the first infrequent or irregular unearned income received results in PSY N01 (excess income) in a month, the $60 exclusion must still be applied to this income even if the PSY remains N01. Similarly, if the first infrequent or irregular unearned income is received in a month of non-pay during the quarter (e.g., N04, N22, etc.), the $60 exclusion must still be applied to this income which was received first.

K. Procedure – benefit payments prior to July 1, 2004

1. Evaluating income received from more than one source -- some on a monthly basis, some only once in a calendar quarter

Compare only the income received once in a calendar quarter against the $10/$20 monthly limits (see SI 00810.410K.3.).

2. Frequency of receipt

Even though infrequent income has a monthly dollar limit, evaluate the frequency of receipt over a calendar quarter.

3. Amount of income

• Add all of the earned income received on an infrequent or irregular basis in a month and compare the total against the $10 monthly limit; and/or

• Add all of the unearned income received on an infrequent or irregular basis in a month and compare the total against the $20 monthly limit.

L. Examples – benefit payments beginning July 1, 2004

1. Infrequent/Irregular income — quarterly income only

Situation: The recipient receives a birthday gift of $100 cash in January and wins $25 in March playing the State lottery.

Analysis: Since the income received is no more than once a quarter, its receipt is infrequent. Since neither could be anticipated, both are also irregular. The $60 infrequent or irregular income exclusion reduces the $100 to $40 since it is the first infrequent or irregular income received in that quarter. The $25 received in March is not affected by the infrequent or irregular income exclusion.

2. Infrequent/Irregular income – monthly and quarterly income

Situation: The husband in an eligible couple receives a one-time wage payment of $85 for a single day of work in September. The wife receives a title II check of $150 each month. The husband receives an unexpected birthday gift of $30 in cash in September 2004 from his daughter. The husband also wins $15 playing Bingo.

Analysis: The $30 gift is both infrequent and irregular unearned income. The $15 Bingo winnings are both infrequent and irregular unearned income. The $45 of unearned income in September from these sources may be excluded. The title II is received each month. Therefore, it is not excludable as infrequent or irregular. The wage payment is infrequent earned income and the first $30, of the $85 received, is excludable. The remaining $55 is subject to the other earned income exclusions (i.e., $65 plus one-half the remainder).

3. Infrequent/Irregular income – amount exceeds limit

Situation: The claimant files for SSI in September 2004. In that month, he receives a birthday gift of $25 cash from a friend on September 15. Also on September 2, his sister, who lives elsewhere, pays his $300 mortgage payment directly to the mortgage company “just to help him out this month.”

Analysis: Both sources of income are infrequent and irregular. However, since the $300 payment was received first, the $60 exclusion reduces the amount to $240. This $240 is subject to the $208 PMV (2004 rate), so in September, we count ISM of $208 and cash of $25. NOTE: If the cash birthday gift had been received first, the $25 would have been excluded as infrequent or irregular income and the $300 mortgage payment would have been reduced to $265 by the remaining $35 of the infrequent or irregular income exclusion. The $265 remaining mortgage payment would then be subject to the $208 PMV.

4. ISM from an institution

Situation: An individual lived in an institution to receive vocational training from August 31, 2004 through December 20, 2004. The individual received food and shelter from the institution during the months September through December. The individual did not receive any ISM and did not have any other unearned income before or after the period of institutionalization.

Analysis: The CR correctly values the food and shelter received from the institution at the PMV for all months September through December. The first $60 of the actual value of ISM received in September is excluded as infrequent income. The remaining amount after the $60 is deducted is subject to the PMV. The ISM received in the months October through December is not irregular because the individual could have reasonably expected to receive the food and shelter. The ISM received in the months October through December is also not infrequent income because the individual received the ISM in more than one month of the calendar quarter.

5. Child support received from absent parent

Situation: An SSA eligible child received ISM in May 2006 from an absent parent as part of her child support agreement. The actual value of the ISM was $600. The absent parent did not provide ISM in any other months during the calendar quarter.

Analysis: For the purpose of applying the infrequent or irregular income exclusion, the CR correctly treats the ISM as if it was child support and determines that the infrequent or irregular income exclusion does not apply because the child support is subject to another income exclusion. The CR then excludes from income $200 (one-third of the $600 in child support). The remaining $400 of ISM is subject to the PMV. The 2006 PMV is $221.00, which the CR charges as income in the month of May.

M. Examples – benefit payments prior to July 1, 2004

1. Infrequent income – quarterly income only

Situation: The claimant opens up a checking account on February 27, 2004. The account pays interest on a monthly basis. The claimant files for SSI the next month, in March, and receives his first checking account interest payment on March 31 in the amount of $10.

Analysis: The $10 interest payment is excludable as infrequent in March only, since it was received only once in the January-March quarter.

The monthly interest received in April and subsequent months is not excludable as infrequent or irregular since the interest is received more often than once in each calendar quarter and is received regularly.

2. Infrequent/Irregular income – monthly and quarterly income

Situation: The recipient owns two bank accounts, a checking account that pays interest of $2 a month and a savings account that pays interest of $19 once a quarter.

Analysis: The checking account interest is received more than once a quarter and is therefore not infrequent and not excludable under this provision. The savings account interest is received only once a quarter and is, therefore, infrequent. Since the total of all the unearned infrequent income does not exceed $20 in a month, the savings account interest may be excluded under this provision.

Note that in determining whether any interest income in this situation can be excluded as infrequent, we consider only the amount of income received once in a calendar quarter and compare that amount to the $20 unearned income limit for the infrequent/irregular income exclusion. Accordingly, in this situation, we do not add the $2 monthly checking account interest to the $19 savings account interest.

Also note that if the individual in this example has no income other than the savings and checking account interest, the checking interest is excludable under the $20 general income exclusion. See SI 00810.420 for a discussion of the general income exclusion.

3. Infrequent/Irregular income – amount exceeds limit

Situation: The recipient owns a savings account which pays interest of $8 in the first month of each quarter. Also in the first month of every quarter, the recipient's sister gives her $16 in cash to help her pay utility bills.

Analysis: Although both the income from her savings account and the income from her sister are received infrequently, the total of the infrequent income exceeds $20 in a month. Therefore, none of the income is excludable under this provision.

Note that were the sister to give the recipient $16 in the second or third month of every quarter (i.e., not in the same month the interest income is received), both types of income could be excluded under the infrequent income provision.

N. Procedure – cases processed between 07/01/04 and 12/31/04

From July to December 2004, POMS incorrectly instructed adjudicators to exclude infrequent or irregular income as long as the amount received in a calendar quarter did not exceed $30 for earned income and $60 for unearned income.

If during an initial claim or redetermination interview, you determine that an individual was denied or underpaid SSI benefits due to the application of the policy in POMS between July and December 2004, use the rules of administrative finality to reopen the case for good cause and correct the entitlement and/or payment (see SI 04070.010).

O. Reference

SI 00830.050, Relation of the infrequent/irregular to other income exclusions