GN 03930: Fee Authorization Under the Fee Petition Process
TN 8 (02-05)
A. Policy – Effective with the Implementation of Title II Redesign Release 3
Effective with the implementation of the Title 2 Redesign Release 3 (T2R3) on June 21, 2004, in fee petition cases, the primary claimant pays the authorized fee from his/her withheld past-due benefits to the maximum extent possible. Then, if two or more auxiliaries are involved and a portion, but not all, of their withheld past-due benefits are used to pay all or part of the remainder of the authorized fee directly to the representative, under the circumstances listed below, the benefit authorizer (BA) or benefit technical examiner (BTE) prorates the excess past-due benefits withheld from the auxiliary beneficiaries. The proration is based on each auxiliary beneficiary's proportionate share of the difference between the total fee and the amount withheld from the primary claimant’s past-due benefits.
SSA prorates the excess if:
SSA certifies direct payment of all or part of the representative's fee;
there is no need to continue withholding (e.g., for administrative review, or for possible direct payment of a fee a Federal court authorizes under § 206(b) of the Social Security Act) and the authorized fee was more than the amount SSA withheld from the primary claimant’s past-due benefits;
SSA must release the funds remaining to two or more auxiliary beneficiaries; and
all auxiliaries do not live in the same household.
NOTE: SSA does not prorate the excess withholding when all auxiliary beneficiaries live in one household.
B. Procedure – Effective with the Implementation of T2R3
Effective June 21, 2004, follow steps 1-9 to determine how to release the excess past-due benefits withheld. In the example shown, the authorized fee is $9,732; 25 percent of the primary claimant’s past-due benefits is $7,288, and HB is working.
|
Step |
Action |
|
Example |
|---|---|---|---|
|
1 |
Add the amount(s) of past-due benefits withheld from each auxiliary beneficiary. |
$ 860. +2,784. $3,644 |
HB’s withholding HC1’s withholding Sum of withholding from auxiliaries (HB & HC1) |
|
2 |
Determine the direct payment amount not satisfied by the primary claimant’s withheld past-due benefits (i.e., determine the fee amount the auxiliaries will pay). |
$9,732. $2,444 |
Authorized fee Primary claimant’s withholding Fee amount auxiliaries to pay |
|
3 |
Determine the auxiliaries’ excess withholding: difference between the amount withheld from the auxiliary beneficiaries (from Step 1) and the direct payment amount the auxiliaries to pay (from Step 2). |
$3,644 - 2,444 $1,200 |
Amount withheld HB & HC1 Amount HB & HC1 to pay Excess withholding |
|
4 |
Find each auxiliary beneficiary's percentage of the total past-due benefits withheld from auxiliaries: divide the amount of past-due benefits withheld from each beneficiary by the total past-due benefits withheld from all auxiliaries (from Step 1). Carry your result to four decimal places, and do not round. |
$ 860 $ 3,644 |
= .2360 for HB |
|
5 |
Determine the approximate refund amounts: multiply the total excess withheld from all auxiliaries (from Step 3) by each beneficiary's withholding percentage (from Step 4). Repeat for each beneficiary. |
$ 1,200 23.60% = $283.20 for HB $ 1,200 76.39% = $916.68 for HC1 |
|
|
6 |
Add the approximate refunds amounts (from Step 5). |
$ 283.20 + 916.68 $1,199.88 |
HB HC1 Sum |
|
7 |
From the excess withheld (from Step 3), subtract the sum from Step 6. |
$ 1,200.00 - 1,199.88 $ .12 |
Excess Sum Remainder |
|
8 |
Add any remainder (from Step 7) to the approximate refund amount (from Step 5) of the first auxiliary in alphabetical order based on the beneficiary identification codes (e.g., B; if no B, then C1; etc.). |
$ 283.20 |
HB's approx. refund |
|
9 |
The sum of the resulting refund amounts will equal excess withheld from all auxiliaries. |
$ 283.32 +916.68 $1,200.00 |
HB’s actual refund HC1’s actual refund Total excess refund |
C. POLICY – prior to the implementation of T2R3
Prior to the implementation of T2R3 on June 21, 2004, in fee petition cases, the benefit authorizer (BA) or benefit technical examiner (BTE) prorated the excess past-due benefits withheld (based on each beneficiary's proportionate share of the total) if:
SSA certified direct payment of all or part of the attorney representative's fee;
there was no need to continue withholding (e.g., for administrative review, or for possible direct payment of a fee a Federal court authorizes under § 206(b) of the Social Security Act);
SSA had to release the funds remaining to the claimant, and one or more auxiliary beneficiaries; and
there was more than one family unit. As GN 03920.050F. explains, the BA/BTE did not prorate when all beneficiaries live in one household.
NOTE: Prior to February 28, 2005, SSA made direct fee payment only to attorneys.
D. Procedure – Prior to the Implementation of T2R3
Prior to June 21, 2004, Steps 1-8 were followed to determine how to release the excess past-due benefits withheld. In the example shown, HB2 was working.
|
Step |
Action |
|
Example |
|---|---|---|---|
|
1 |
List and add the amount(s) of past-due benefits withheld from each beneficiary. |
$ 7,288 860. +2,784. $10,932. |
HA’s withholding HB’s withholding HC1’s withholding Total withheld |
|
2 |
Determine the excess withheld: From total withheld, subtract the amount to certify for direct payment to attorney. |
$10,932. - 9,732. $1,200. |
Total withheld Direct payment before assessment deducted Excess withheld |
|
3 |
Find each beneficiary's percentage of the total: divide the amount of past-due benefits withheld from each beneficiary by the total past-due benefits withheld from the family (Step 1). Carry the result to four decimal places, and do not round. |
$ 7,288 $ 10,932 |
= .6666 for HA |
|
4 |
Determine the approximate refund amounts: multiply the excess withheld (from Step 2) by each beneficiary's percentage (from Step 3). Repeat for each beneficiary. |
$ 1,200 66.66% = $799.92 for HA $ 1,200 7.86% = $94.32 for HB |
|
|
5 |
Add the approximate refund amounts (from Step 4). |
$ 799.92 94.32 + 305.52 $1,199.76 |
HA HB HC1 Sum |
|
6 |
From the excess withheld (from Step 2), subtract the sum (from Step 5). |
$ 1,200.00 - 1,199.76 $ .24 |
Excess withheld Sum Remainder |
|
7 |
Add any remainder to the approximate refund amount (from Step 4) of the first auxiliary in alphabetical order based on the beneficiary identification codes (e.g., B; if no B, then C1; etc.). |
$ 94.32 |
HB's approximate refund |
|
8 |
The sum of the resulting refund Amounts will equal the excess withheld. |
$ 799.92 94.56 + 305.52 $1,200.00 |
HA’s actual refund HB’s actual refund HC1’s actual refund |