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IMA POLICY MANUAL
PART VIII: CASE MAINTENANCE
Chapter 6: Overpayment and Underpayment
Initiating Recovery 6.4.1
| BOTH |
Within the calendar quarter following discovery of the overpayment, one of the following shall be initiated:
- recovery of the overpayment
- recoupment from a recipient’s benefit
- sending a letter requesting repayment and trying to arrange a repayment agreement from a former recipient.
Failure to take any of the above actions within the timeframe does not affect the group’s responsibility to repay. It also does not affect the department’s responsibility to recover the overpayment. |
| BOTH |
When a group that has been charged an overpayment continues to receive assistance, a portion of the group’s benefit is withheld or recouped to repay the overpayment. DHS shall not recoup more than the actual overpayment of assistance.
The SSR must identify the overpayment and gather all the verification associated with the cause of the overpayment (i.e. pay stubs, proof of income, household composition, residence, verification of expenses, change in resources, etc.) The case record must also be documented in reference to the overpayment. The SSR should compile and forward a claims package (see Section 6.4.4: Reporting of Overpayment in this chapter) to the Overpayment Unit, which will calculate the overpayment after reviewing the verification and documentation. After the claim has been established, the Overpayment Unit will mail the appropriate Demand Letter and, for Food Stamp claims, the Repayment Agreement Letter (F719).
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TANF
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The steps for calculating the TANF recoupment amount differ for customers with no gross earned and unearned income and for those with such income.
For those customers with no gross earned and no gross unearned income, the recoupment amount is equal to 10 percent of the maximum benefit amount.
For those customers with gross earned or unearned income, the recoupment is the largest amount that can be taken from the TANF grant that will still leave the household with gross income that is at least 90 percent of the maximum benefit level. Follow these steps to determine the recoupment amount:
- Step 1: Calculate the grant amount the group would be eligible for if no recoupment were required, applying all applicable disregards and deductions.
- Step 2: Add together the grant calculated in Step 1 and the group's gross earned and unearned income.
- Step 3: Subtract 90 percent of the maximum benefit level for a family of the appropriate group size from the result of Step 2. This difference is the recoupment amount, unless this difference is greater than the grant calculated in Step 1. In this case, the group's entire benefit is recouped.
| Mr. Temple receives $379 in TANF for his two children and himself. Beginning in June, his TANF benefits will be reduced to recover an overpayment. Since he has no other income, 10 percent of his TANF benefit ($38) will be recouped to recover the overpayment. He will receive $341 ($379 - $38 = $341) in TANF. |
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Ms. Kremer receives $63 in TANF for her three children and herself. She also receives $400 in Social Security. Beginning in July, her TANF benefit will be reduced to recover an overpayment. Her recoupment is calculated as shown:
TANF Entitlement $ 63.00
+ Gross Unearned Income $400.00
= $463.00
- 90% of Payment Level for 4 $416.00
= Recoupment $47.00
Ms. Kremer will receive $16 in TANF after the $47 recoupment is deducted.
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Ms. Benton is working and receives a reduced TANF benefit. She earns $1,000 monthly and gets $70 in TANF for her three children and herself. Beginning in May, her TANF benefit will be reduced to recover an overpayment. Her recoupment is calculated as shown:
TANF Entitlement $70.00
+ Gross Earned Income $1000.00
= $1070.00
- 90% of Payment Level for 4 $416.00
= Recoupment $654.00
Since the amount that may be recouped—$654—is more than Ms. Benton's TANF entitlement—$70—her entire TANF benefit will be recouped.
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Mr. Calhoun works part time while receiving TANF. He earns $200 a month and gets $284 for his daughter and himself. Beginning in October, his TANF benefits will be reduced to recover an overpayment. His recoupment is calculated as shown:
TANF Entitlement $284.00
+ Gross Earned Income $200.00
= $484.00
- 90% of Payment Level for 2 $268.00
Recoupment $216.00
Mr. Calhoun will receive $68 in TANF after the $216 recoupment is deducted from his benefit.
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| FS |
The amount recouped each month from a participating FS group with an outstanding FS overpayment depends on the type of overpayment:
- For nonfraud error overpayments, recoup 10 percent of the group’s monthly allotment or $10 a month, whichever is greater.
- For fraud overpayments, recoup 20 percent of the group’s monthly allotment or $20 a month, whichever is greater.
For households with one or two members for which the minimum benefit rule generally applies, the application of the minimum benefit rule occurs prior to the reduction in benefits due to recoupment. That is, a group with one or two members can receive a benefit of less than $10 if the reason the benefit is below this amount is because of the recoupment of an overpayment.
| Mr. Ford is charged a nonfraud overpayment. His monthly FS entitlement is $60. Although 10 percent of his allotment is $6, a $10 recoupment will be deducted from his benefits. If Mr. Ford was receiving $120 in FSs, $12 (10 percent) would be recouped. |
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Ms. Franklin is charged a fraud overpayment. Her monthly FS entitlement is $250. Ms. Franklin’s allotment will be reduced by $50 (20 percent of her entitlement).
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| A one-person FS group receives a $10 minimum benefit. The group has an outstanding nonfraudulent overpayment. The group’s $10 minimum benefit can be reduced by 10 percent in this case. | |
Circumstances Under Which Overpayments are Not Collected for
Nonparticipating Households 6.4.3
| TANF |
When a group continues to receive TANF, all overpayments are collected by withholding a portion of the group’s TANF benefits to repay the overpayment. When a group with an outstanding overpayment no longer receives TANF, the Division of Payment and Collections is responsible for collecting outstanding overpayment claims. In some cases, the Division of Payment and Collections may write-off a claim for a non-participating household if the claim meets any of the following criteria:
- All adult household members are deceased and the District is not planning to pursue collection from the estate.
- The claim has been determined not cost-effective to collect, because the claim balance is $100 or less and the claim has been delinquent for 90 days or more.
- The claim has been delinquent for three years.
- The household cannot be located.
Claims meeting the termination and write-off criteria should be reported as terminated claims.
Claims records should be maintained separately from other case information. When the remaining case record is destroyed, if the claim has not been fully recovered, the claim record will be maintained in the Overpayment Unit for three years after closure of the claim. A claim is closed only when it has been adjusted or reduced to $0.
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FS
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See TANF, except the Division of Payment and Collections may write-off a claim for a nonparticipating household is the claim meets any of the following criteria:
- All adult household members are deceased and the District is not planning to pursue collection from the estate.
- The claim has been delinquent for ten years.
- The household cannot be located.
- The claim has been determined not cost-effective to collect, because the claim balance is $25 or less and the claim has been delinquent for 90 days or more. However, if the household has multiple overpayment claims against it that total $25 or more, then recovery actions can be taken.
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