SI 00820: Earned Income
TN 56 (04-12)
A. Background describing how accurate wage estimates prevent improper SSI payments
We compute the amount of Supplemental Security Income (SSI) payments a recipient receives based on the income the recipient, deemor or representative payee of the recipient reports to us.
When we routinely solicit and post precise wage estimates to SSI records, we support the agency’s efforts to prevent improper payments. Accurate wage estimates directly affects the recipient’s monthly payment.
B. Policy for wage estimating
1. What information do you need to make a wage estimate?
A pay stub usually contains three components that you need to create an accurate wage estimate:
the amount the wage earner’s hourly pay;
the number of hours the wage earner routinely works in a pay period; and
the scheduled receipt dates (weekly, biweekly, bimonthly, etc.).
2. When should you obtain an estimate?
Request wage information for recipients and deemors at most initial claims, pre effectuation reviews and redetermination reviews. Post an estimate of wages for the subsequent 14 months any time you receive a report of new wage information.
NOTE: Consider whether the recipient, deemor, or representative payee of the recipient will be capable of reporting the wages via automated reporting methods, Recruiting monthly wage reporters to use the myWageReport application, Supplemental Security Income Telephone Wage Reporting (SSITWR) system, or the Supplemental Security Income Mobile Wage Reporting (SSIMWR) application is mandatory. Document all attempts to recruit wage reporters. For instructions on Monthly Wage Reporting – Recruiting Reporters, see SI 00820.144.
3. Who may provide wage information?
Recipients, representative payees, and deemors are the preferred source of wage information.
EXCEPTION: If the recipient, deemor or representative payee of the recipient cannot give enough information to create a logical wage pattern by providing the wage earner’s rate of pay, number of hours worked per pay period and number of pay periods in a month, you may need to contact a third party (i.e., SSA approved online wage verification companies, National Directory of New Hires (NDNH), or the employer). For information regarding creating a wage estimate from third party information, see SI 00820.150C.2. in this section.
4. What date should you use when creating a wage estimate?
At all stages in the life of the case, create a wage estimate that projects wage data for 14 months, beginning with the latter of:
the first month of employment, or,
the first month that will not create an overpayment attributable to the estimated wage amount.
For information addressing the Period for Which an Estimate is Required, see SI 00810.600.
For information on the interaction between income estimation and deeming, see SI 00810.620.
For more information on how to process wage estimates that reduces the recipient’s SSI payment amount, see SI 00820.150E, in this section.
Example of determining the wage estimate beginning date
On May 2 (before the Goldberg Kelly (GK) cutoff), a recipient comes to the field office and reports that he started working March 20 and received the first pay check in April. He receives gross wages of $800 monthly and does not have any other income. Since his wages will not cause him to be ineligible for SSI, you post the new wage estimate beginning in April. The new wage estimate will reduce his SSI benefit beginning in June.
NOTE: Remind recipients, deemors, or representative payee that they are responsible for reporting all changes in income timely. Point out that they can report changes in wages via the SSITWR system, or the SSIMWR application, and report income via the phone, in-person, fax, or by mail.
C. Procedure for obtaining and posting precise wage estimates
1. What known facts do you need to consider?
Establish a logical wage pattern by reviewing these factors with the wage earner:
rate of pay,
hours worked per pay period,
pay date, and
number of pay periods in each month.
Be alert to wage earners who perform seasonal work (i.e., school bus drivers, circus help, and produce pickers).
Base your estimate on the verified wage data on the Supplemental Security Record (SSR), without contacting the wage earner, if the employer or employee (i.e., recipient or deemor) reports regularly.
Ask about any deductions that the employer may routinely withhold from the wage earner’s pay (i.e. cafeteria plan deductions, child support). For more information regarding earned income exclusions see SI 00820.500.
Project any deductions and Blind Work Expenses (BWEs), Income Related Work Expenses (IRWEs), or Plans to Achieve Self-Support (PASS) if applicable. For information on substantiating:
IMPORTANT: Estimate the wage amount based on exactly how often the employer pays the wage earner. Only use a monthly estimate when the employer actually pays the wage earner once a month. If the employer pays the wage earner weekly, estimate the wage amount according to a weekly pay schedule.
2. When do you need to obtain more information?
If the wage earner cannot provide the basic information of hourly pay, hours worked per pay period, and frequency of pay that you need to create a wage estimate, develop the evidence of wages following the procedure outlined in SI 00820.130C. If original pay slips are not available, take the following sequential steps:
Check to see if the employer subscribes to an SSA approved wage verification company listed in SI 00820.147C.2. If the wage earner’s employer subscribes to the service, use the service to verify wages.
If the employer does not subscribe to an SSA approved wage verification service, use the following sources to determine a wage estimate:
photocopied pay slips;
Interstate Benefit Inquiry (IBIQ), National Directory of New Hires (NDNH), SSA Access to State Records Online (SASRO) queries;
Master Earnings File (MEF), W-2s, tax forms; or
Non SSA-approved wage verification companies, only if an employer will not provide wage verification and refers you to a non-SSA approved wage verification company for wage information.
Review the wage information and consider whether it is sufficient to determine a wage estimate. For more information about calculating a monthly wage amount from annual or quarterly wage data, see SI 00820.130C.6.a – SI 00820.130C.6.b.
NOTE: Wage estimates built from NDNH data are subject to change as NDNH data is normally 6 months old. If the recipient, deemor, or representative payee of the recipient subsequently contacts you to report the wage earner’s hours changed since the last NDNH or MEF data:
accept his or her allegation,
post the new estimate,
document the conversation on a MSSICS DROC screen and lock it, or on an SSA-5002 (Report of Contact) in non-MSSICS.
If you need more information, call the employer, or if not available by phone, send an SSA-L4201-BK (Letter to Employer Requesting Wage Information) to them via fax or mail. For more information on the SSA-L4201-BK, see SI 00820.145.
3. How to determine an estimate when not able to obtain required information?
If you speak with the wage earner or contact a secondary source as listed in SI 00820.130A.2., but you are not able to obtain all the information required to create an accurate wage estimate (i.e., the hourly rate of pay, the number of hours worked per pay period, or the pay date and the frequency of pay), use your judgment to create as accurate an estimate as possible.
D. Procedure for creating wage estimates for non-MSSICS case
For cases outside of MSSICS:
Create an estimate using pay slips or other wage information available and record all pertinent wage information listed in SI 00820.150B.1.
Document how you derived the wage estimate on an SSA-5002 , or obtain a signed SSA-795 (Statement of Claimant or Other Person) as appropriate.
Fax the document(s) into Eview or NDRED, as appropriate.
Consider whether any allowable deductions exist (i.e. cafeteria plans or court-ordered support) or special exclusions (IRWEs, BWEs, PASS) apply before you create a 14-month projection of wages.
Project any deductions, if applicable.
Transmit via SIC1 or SPE1 from the Title XVI Menus (SXVI) data input screen (SSA-450S or SSA-1719B Supplemental Security Income Post-Entitlement Input form), the final entry for the EN field as a “C” (continuing) code in the frequency field. For description of type and person code or specific exclusion see SM 01005.170D and for type of earned income and person code see SM 01305.105.
Simultaneously transmit a remark detailing the wage earner’s hourly wage, number of hours in pay period, frequency of receipt and any deductions.
NOTE: To arrive at a 14-month projection of wages, you could use the Title XVI Interactive Comps income projection program found at the PCOM main menu under selection #8.
E. Procedure when the new wage estimate reduces payment amount
Do not increase a wage estimate for any month that will create an overpayment based on an unverified wage amount. If a wage earner reports an increase in his or her gross wages:
Document the conversation on a MSSICS DROC screen and lock it, or on an SSA-5002 in non-MSSICS.
Ask the wage earner to save the pay slips that reflect the increased wage amount.
Post the increased wage estimate starting with the first month that will not cause an overpayment attributable to the estimated wage amount.
NOTE: Do not change wage estimates for prior months based on an allegation alone. For prior periods, verify the wage amounts according to the policies in SI 00820.130 and SI 00820.135 and change the income data based on the wage verification.
Example 1 - No current wage estimate is on the SSR and we input a new wage estimate before the GK cutoff
The mother of a disabled child comes to the field office on May 9 to report she started working on March 20 and received her first pay check in April. The SSI record currently shows no income for the family. The mother’s new monthly gross wage amount of $2000 does not make the child ineligible for SSI; however, the wages will reduce the child’s payment amount. Since we can still reduce the SSI payment for June without causing an overpayment, post the new wage estimate beginning with April.
Example 2 - No current wage estimate on the SSR and we input a new wage estimate after the GK cutoff
Same scenario as in example 1, except the mother reports her new wage amount on May 20 (after the GK cutoff). Since posting the wage estimate beginning with April will cause an overpayment for June, you post the wage estimate beginning with May and ask the mother to submit pay slips for April. Recruit the mother to report her monthly wages using the SSI Telephone Wage Reporting system.
Example 3 - New wage estimate causes ineligibility
Same scenario as in example 1, except the mother reports her wages on May 31 and the new gross wage amount of $3500 makes the child ineligible for April and May. Since beginning the estimate in June will cause an overpayment, you post the estimate beginning with July and ask the mother to submit pay slips for March, April, May, and June.
NOTE: For all examples, record when the mother actually started working, the rate of pay, hours worked per pay, the pay date and the frequency of pay on a MSSICS DROC screen and lock it, or on an SSA-5002 in non-MSSICS.
F. Procedure for when the wage earner anticipates a decrease in his or her wages
Before decreasing a previously developed wage estimate, consider whether available evidence supports the current allegation that a wage earner’s wages decreased. If evidence to the contrary exists, contact the employer to verify the anticipated decrease. Document your determination on a MSSICS DROC screen and lock it, or on an SSA-5002 in non-MSSICS.
Example of a wage earner anticipating a decrease in wages
You complete a redetermination and obtain primary wage evidence for the previous 24-month review period of the disabled child’s father. He grossed $600 biweekly, except December to March when he worked overtime and grossed $1000 biweekly. The child’s payee (mother) tells you she expects her husband to work less overtime this winter and she wants you to post a $600 biweekly gross estimate for him year round. As evidence to the contrary exists, you contact his employer and verify that they do not want him to work overtime this winter before reducing the wage estimate.
NOTE: Document your conversations with the wage reporter and the employer as well as show how you made your determination on separate MSSICS DROC screens and lock them, or on an SSA-5002 in non-MSSICS.
G. Procedure when wage earner anticipates a wage increase
When a wage reporter states that the wage earner regularly receives an increase in pay during the year (e.g. January cost-of-living increase), the allegation alone is sufficient to change the future wage estimate.
Post a wage estimate for the present date to the estimated date of change.
Post a wage estimate from the effective date of the wage increase to at least 14 months from the present date.
Document the determination by recording the estimated effective date and new hourly or per pay gross amount on a MSSICS DROC screen and lock it, or on an SSA-5002 in non-MSSICS.
H. Procedure for documenting the wage estimate
Take the following steps to document:
Document your determination of the estimate using the MSSICS wage screen (IWAG) and MSSICS DROC screen and lock it, or on an SSA-5002 in non-MSSICS.
Fax any paper evidence into NDRED or eView, as appropriate.
View the documents stored in NDRED and eView for readability by using the Claims File User Interface (CFUI). Do not retain after storing the documents. For more information on storing forms electronically, refer to GN 00301.322.
SI 00810.600 Period for Which an Estimate is Required
SI 00810.620 Estimating Income – Interaction with Deeming
SI 00820.141 Alternative Wage Verification – Periodic Reports With Evidence
SI 00820.144 Monthly Wage Reporting Recruiting Reporters
SI 00820.145 SSA-4201-BK (Letter to Employer Requesting Wage Information)
SI 00820.147 Evidence of Wages – Wage Verification Companies
SI 00820.500 Earned Income Exclusions - General
SI 00820.535 Blind Work Expenses (BWE)
SI 00820.540 Impairment-Related Work Expenses (IRWE)
SI 00870.008 Exclusions Under Plans to Achieve Self-Support (PASS)
SI 02305.034 Period for Review - RZs and LIs
GN 00301.285 Statement and Other Documentation
GN 00301.286 Electronic Evidence Documentation and Retention
GN 00301.288 What Information is Needed on EVID and DROC in PE Situations to Identify the Type of Evidence Submitted
SM 01305.105 Type and ID
SM 01005.170 Earned Income and Exclusions