Processing Internal Revenue Service Alerts for Supplemental Security Income Recipients

Thursday, December 26, 2013
Report Number: 
Report Type: 
Audit Report
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The Supplemental Security Income (SSI) program provides cash assistance to people who are aged, blind, or disabled and whose income and resources are limited. Since SSI eligibility is based on need, SSA must be aware of any changes in recipients’ income or resources.

The Spending Reduction Act of 1984 provides for SSA to receive financial information from the Internal Revenue Service (IRS) to help detect unreported nonwage information, such as security trades, winnings, property sales, and pensions. When IRS records indicate a recipient may have unreported income or resources, SSA systems generate an alert, and annotate the recipient’s benefit record. SSA field office staff develops these alerts by verifying the information with the recipient or the financial institution and adjusts or terminates the benefits, if warranted.

Our objective was to determine whether SSA was properly processing the Internal Revenue Service’s 1099 alerts and appropriately adjusting benefit amounts for SSI recipients.