TN 16 (08-08)

A. Background

Any payment issued to a representative payee after the death of a beneficiary is an overpayment that becomes the responsibility of the payee. A paper check payment issued to a representative payee after the death of a beneficiary is automatically posted to the Master Beneficiary Record (MBR) of the deceased beneficiary as an overpayment when the beneficiary’s death termination is input, even though the paper check may be unnegotiated.

B. Policy

After the overpayment is posted to the MBR, the representative payee is sent a notice. The following provides policy for handling specific scenarios.

1. Representative payee contacts SSA concerning overpayment notice

If the representative payee indicates:

• the check has not been cashed, but they no longer have the paper check in their possession (e.g. the check has been lost or destroyed), input an F-stop to obtain credit for the check. The F-stop ensures the unnegotiated check is not referred to the Treasury Offset Program/External Collection Operation (TOP/ECO) when the check remains unnegotiated.

• the check has not been cashed, and they still have the paper check in their possession, follow GN 02405.006 to ensure proper cancellation/return of the check to credit SSA’s records. If the check is not returned, input an F-stop.

• he or she cashed the check, the representative payee is responsible for the overpayment. If fraud is suspected, see GN 04111.025 for referral to OIG.

2. Representative payee fails to contact SSA

If the representative payee fails to contact us concerning the overpayment or does not return the check during the due process period, we will attempt to collect the overpayment via direct benefit withholding if they are entitled on our records. When the representative payee for a title II benefit is not entitled on our records and has an eligible debt, the payee is loaded into the Non-Entitled Debtors (NED) database. We will attempt to recover the overpayment from representative payees by sending a billing notice and then using the TOP/ECO collection tools including Tax Refund Offset, Administrative Offset, Credit Bureau Reporting, Administrative Wage Garnishment, and Federal Salary Offset.

NOTE: When a check remains unnegotiated after 12 months from the check’s issue date and no F-stop is input, we receive a limited payability credit from the Department of the Treasury for the unnegotiated check in the 15^th month after the check’s issue date (for limited payability information, see GN 02401.901).

The PC will apply the limited payability credit to the representative payee’s overpayment on the MBR by coding the SSA-4208, Reclamation Data Input form, with the RTC-B to change the RCLRN to B. This coding instructs the system to reduce the overpayment amount. If the payment center (PC) is unable to process the SSA-4208/exception, a MADCAP action is necessary to reduce the overpayment manually.

3. For additional information

• GN 02201.001 – Overpayments-General

• GN 02201.009 – Notification of Overpayment.

• GN 02201.000 – General Information Title II, Title XVI, and Title XVIII Overpayments - Part I

• GN 02210.001 – Adjustment of Overpayments

• SM 00610.040 – External Collection Operation (ECO)

• SM 00609.885 – How to Complete Form SSA-4208 for Limited Payability Determination (LPD)

• GN 02230.035 – Overview of Non-Entitled Debtors

C. Procedure for an F-stop input

Reminder: An F-stop can only be input within 12 months from the check’s issue date; otherwise, REACT will create an exception.

Input an F-stop on a paper check issued to a representative payee after the death of a beneficiary to obtain credit for the check:

• FO/TSC: Send an Modernized Development Worksheet (MDW) to the servicing PC to request that an F-stop be input. Provide the SSN, BIC, payment date, payment amount and reason for the F-stop input.

• PC: Input F-stop via RSDHI using PESP (MSOM RSDHI 002.005) input screens or by using the SSA-4510 Stop Payment Request Input Form (MSOM INTRANETMAMPSCDI 004.003) screen.

D. Process after F-stop is input

After the F-stop is input, Treasury will return a disposition to SSA.

A disposition of:

• “32” (check is outstanding) will result in a “00” credit being returned to SSA from Treasury. A REACT alert will be created when no SPA field is on the MBR. The PSC will apply the “00” credit to the BOUD, reducing the overpayment.

• “11” (check cashed) will result in a claims package being mailed to the PSC by Treasury. If the representative payee protests the overpayment due to nonreceipt/forgery, the representative payee will review and complete the claims package. Treasury will process a forgery determination on the check. See GN 02406.160 for more information on Treasury’s claims package.

E. References

• GN 02201.029, The Treasury Offset Program (TOP)

• GN 02201.030, Collection of Title II Overpayments by Tax Refund Offset (TRO)

• GN 02201.031, Collection of Title II Overpayments by Administrative Offset

• GN 02201.032, Reporting Title II Overpayment Debts to Credit Bureaus

• GN 02201.043, Collection of Title II/Title XVI Overpayments by Federal Salary Offset (FSO)

• GN 02230.040, Non-Entitled Debtors (NED) – Representative Payee Who Received Overpayments After the Death of Title II Beneficiaries

• GN 02408.025, Manual F-Stop Process – Titles II and XVI