TN 101 (09-08)

Citations:

Social Security Act, Section 1612(b)(24) as amended by P.L. 110-245, § 202.

A. Introduction

On June 17, 2008, President Bush signed into law H.R. 6081, the Heroes Earnings Assistance and Relief Tax Act of 2008 (the HEART Act,) which excludes State annuities for certain veterans from income for purposes of SSI.

B. Definition of a veteran

The term “veteran” means a person who served in the active military, naval, or air service, and who was discharged or released under conditions other than dishonorable.

C. Policy – The exclusion

Effective for Supplemental Security Income (SSI) benefits payable on or after September 1, 2008, a State annuity paid by a State, to a person, and/or a person’s spouse, on the basis of the State’s determination that the person is a veteran and is blind, disabled, or aged, is excluded from income in the month of receipt for SSI purposes.

NOTE: A State annuity payment is not a benefit issued by the Department of Veterans Affairs, such as VA compensation or VA pension.

D. Procedure — Initial claims and posteligibility

1. Development

If a veteran, and/or a veteran’s spouse, alleges the receipt of a State veteran’s annuity as outlined in SI 00830.260C, ask the individual to submit evidence that verifies the source of the State annuity.

2. Acceptable evidence

• documents in the individual's possession (i.e. award letter from the State),

• office precedent, or

• direct contact with the State.

If evidence verifies that the annuity is paid by the State to a veteran, and/or a veteran’s spouse under this provision, but not the amount or date(s) of payment, accept the individual's allegation of amount(s) and date(s) of receipt. Exclude the State veteran’s annuity payment from income for the month of receipt and without further development.

NOTE: Interest earned on retained payments is not excluded from income. See SI 00830.500 Dividends and Interest.

3. Documentation

Document the acceptable evidence in the MSSICS DROC screen and lock it, shared EVID process, or fax the documentation (e.g., SSA-5002, award letter) into the Certified Electronic Folder (CEF) Non-Disability Repository (NDRED) or the Electronic Folder (EF), as appropriate. Once the documentation is stored and viewed for content in either an eDIB claim filing or through the NDRED by using Claims File User Interface (CFUI), the artifact need not be retained

4. Systems Input

In MSSICS situations, complete the IPEN screen with the State annuity amount received and a “Y” in the DEDUCTIONS column. Deduct the entire amount of the annuity. In the OTHER DEDUCTION AMOUNT REASON, input “State veteran’s annuity exclusion.”
If the State annuity payment is retained into the month following the month of receipt, follow the instructions in SI 01130.662D.4.

In non-MSSICS situations, use an SSA-1719B to add a remark to the SSR indicating the receipt, frequency and amount of the payment and applicability of the State veteran’s annuity income exclusion. See SM 01301.841 R1, R2, R3, R4, R5, - SSR Remarks for input instructions for the SSA-1719B Remarks fields.

Another option is to use an SSA-450SI to add "State veteran’s annuity exclusion" in the CG field, see SM 01005.525 Case Related Data.  However, a PR change, or SSA-1719B input after systems payment, to the CG field, can entirely overlay any entries previously posted on the SSR.

E. References

• SI 00830.500, Dividends and Interest

• SI 00830.099, Guide to Unearned Income Exclusions

• SI 00810.007, Income Exclusions

• SI 00830.050, Overview of Unearned Income Exclusions

• SI 01130.662, State Annuities for Certain Veterans (resource exclusion)