VB 02005: SVB Overpayments
A. Policy – general
Section 808(a)(1) of the Act provides that once it is determined that more than the correct amount of SVB has been paid, one method of recovery is to decrease any SVB payment to which the overpaid person is entitled.
Recovery from SVB is limited to cases where an SVB payment is made in a month. If during the course of recovery, SVB payments are discontinued due to a termination, suspension or stop-payment event, efforts to recover any outstanding overpayment balance will be pursued per VB 02005.120A. If SVB payments are subsequently resumed, and an overpayment balance remains on the record, recovery of the outstanding balance will be resumed at the same rate of withholding used prior to the termination, suspension or stop-payment action.
B. Policy – rate of withholding
1. 10 percent rate of withholding
10 percent of the maximum SVB monthly payment amount (i.e., 10 percent of 75 percent of the FBR); or
The entire SVB monthly payment.
2. 100 percent withholding
SVB overpayments will be recovered at the rate of 100 percent if the overpaid person willfully misrepresented or concealed material information in connection with the overpayment. Recovery at the 100 percent rate can begin even after recovery has already begun at the 10 percent rate (e.g., a determination of concealment is made after recovery begins). However, in this situation, the recipient must be notified in advance of the change in withholding rate.
A request to reduce the rate of withholding will be denied as shown in VB 02005.205D.2. when the overpaid person willfully misrepresented or concealed material information in connection with the overpayment. In this case, see SI 02220.016A.2.e., bullet 3.
C. Policy – request for a different rate of withholding
A request for a different rate of withholding (higher or lower) than the 10 percent rate proposed by SSA can be made at any time, even after withholding at 10 percent has started. The withholding rate cannot be less than $10 per month.
D. Procedure – request for a different rate of withholding
1. Lower rate of withholding requested
When beneficiary requests a lower rate of withholding:
Determine if the request is actually a request for waiver. If it is, see VB 02005.300.
Obtain an SSA-2032-BK, Request for Waiver of Special Veterans Benefits Overpayment Recovery or Change in Repayment Rate.
Negotiate an acceptable recovery rate with the recipient. The negotiated rate should allow for complete recovery of the SVB overpayment within 36 months; however, if this cannot be accomplished, set a rate of withholding appropriate for the financial situation of the recipient. (NOTE: The rate of withholding cannot be less than $10 per month.)
Obtain a signed statement from the overpaid person indicating the negotiated rate agreed on.
If the above is done in an office not having SVB jurisdiction, fax and then mail the material to the CPS/FO with SVB jurisdiction See VB 00901.015.
EXAMPLE: An SVB recipient goes to the Federal Benefits Unit (FBU) to discuss an SVB overpayment notice in which he is notified that $28.00 a month is to be deducted from his SVB to recover a $629.00 overpayment. He is unable to afford this withholding amount, and after discussing the issue, he agrees to a deduction of $20.00 a month. The FBU obtains a signed statement from the recipient outlining the negotiated recovery amount, then faxes and mails the statement to the CPS having jurisdiction.
2. Higher rate of withholding requested
Obtain a signed statement from the recipient indicating that he/she:
Understands that the maximum required rate of withholding is 10 percent; and
Is requesting a higher rate of withholding voluntarily.
NOTE: If the above is done in an office not having SVB jurisdiction, fax and then mail the material to the CPS/FO having SVB jurisdiction. Do not approve a rate of withholding which is higher than the Federal Benefit Rate (FBR) in effect in the year of recovery. See VB 02005.215C.
E. Procedure – CPS/FO processing of requests for a different rate of withholding
1. Request approved
Effectuate the change per VB 02005.215.
2. Request denied
Use DOCS to produce and send a written notice to the recipient advising:
The basis for the denied request, and
The rate at which the overpayment will be recovered.
Do not include a reconsideration paragraph as determinations regarding the amount of withholding are administrative actions which are not initial determinations subject to administrative or judicial review, per VB 02501.040.