[Federal Register Volume 60, Number 12 (Thursday, January 19, 1995)]
[Proposed Rules]
[Pages 3787-3790]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-1309]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Social Security Administration
20 CFR Parts 404 and 422
RIN 0960-AD74
Statement of Earnings and Benefit Estimates
AGENCY: Social Security Administration, HHS.
ACTION: Proposed rules.
-----------------------------------------------------------------------
SUMMARY: We are proposing to revise our rules on sending statements of
earnings and benefit information to individuals. Under our current
rules, which implement section 1143(a) of the Social Security Act (the
Act), we are required to send a statement to an eligible individual who
requests it. Under these proposed rules, we will provide the statement
without a request to an eligible individual, as required by section
1143(c) of the Act.
DATES: Your comments will be considered if we receive them no later
than March 20, 1995.
ADDRESSES: Comments should be submitted in writing to the Commissioner
of Social Security, Department of Health and Human Services, P.O. Box
1585, Baltimore, MD 21235, sent by telefax to (410) 966-0869, or
delivered to the Office of Regulations, Social Security Administration,
3-B-1 Operations Building, 6401 Security Boulevard, Baltimore, MD
21235, between 8:00 a.m. and 4:30 p.m. on regular business days.
Comments received may be inspected during these same hours by making
arrangements with the contact person shown below.
The electronic file of this document is available on the Federal
Bulletin Board (FBB) at 9 a.m. on the date of publication in the
Federal Register. To download the file, modem dial (202) 512-1387. The
FBB instructions will explain how to download the file and the fee.
This file is in Wordperfect and will remain on the FBB during the
comment period.
FOR FURTHER INFORMATION CONTACT: Jack Schanberger, Legal Assistant, 3-
B-1 Operations Building, 6401 Security Boulevard, Baltimore, MD 21235,
(410) 965-8471.
SUPPLEMENTARY INFORMATION: Section 1143 of the Act requires the
Secretary of Health and Human Services (the Secretary) to provide to
eligible individuals ``a social security account statement''
(statement). We must fulfill this requirement in three phases. In the
first phase, we were required, by October 1, 1990, to provide, upon the
request of an ``eligible individual,'' a statement that contains
certain information described below. Section 1143 defines an ``eligible
individual'' as one who has a social security account number, has
attained age 25 or over, and has wages or net earnings from self-
employment.
The statement we provide under section 1143 of the Act must contain
the following information as of the date of the request:
1. The amount of wages paid to and self-employment income derived
by the individual;
2. An estimate of the aggregate of the employee and self-employment
contributions of the individual for old-age, survivors', and disability
insurance benefits;
3. A separate estimate of the aggregate of the employee and self-
employment contributions of the individual for medicare hospital
insurance coverage; and
4. An estimate of the potential monthly retirement (old-age),
disability, dependents', and survivors' insurance benefits payable on
the individual's earnings record and a description of medicare hospital
insurance coverage.
We are carrying out this first phase, which is required by section
1143(a) of the Act and which we explained in the final rules published
November 23, 1992, in the Federal Register (57 FR 54917). In these
proposed rules, we explain how we will fulfill our obligations in the
second and third phases of section 1143.
The second phase of providing statements, as stated in section
1143(c)(1) of the Act, requires that by not later than September 30,
1995, we must furnish this statement to each ``eligible individual''
who has attained age 60 by October 1, 1994 (i.e., by the beginning of
fiscal year 1995), is not receiving benefits under title II of the Act,
and for whom we can determine a current mailing address by methods we
consider appropriate. We must also send this statement to each
``eligible individual'' who attains age 60 in fiscal years 1995 through
1999, i.e., October 1, 1994 through September 30, 1999, if the
individual is not receiving benefits under title II of the Act, and if
we can determine a current mailing address by methods we consider
appropriate. In the case of an individual who attains age 60 in fiscal
years 1995 through 1999, we will mail a statement to the individual in
the fiscal year in which he or she attains age 60. We will mail the
statement without requiring a request from the individual. We will also
advise individuals receiving these statements that the information in
our records will be updated annually and is available upon request.
The third phase of providing statements, as stated in section
1143(c)(2) of the Act, requires that beginning not later than October
1, 1999, we must provide this statement on an annual basis to each
``eligible individual'' who is not receiving benefits under title II
and for whom we can determine a current mailing address by methods we
consider appropriate. We must provide a statement without a request
from the individual and, unlike the second phase, regardless of whether
the eligible individual has attained age 60.
To implement the second phase of section 1143, we will use our
records of assigned social security account numbers to identify
eligible individuals who will attain age 60 by the appropriate times
and who are not receiving benefits under title II of the Act. We have
decided that the appropriate method now for determining an individual's
current mailing address is to obtain it from the individual taxpayer
files of the Internal Revenue Service (IRS). The IRS is authorized by
section 6103(m)(7) of the Internal Revenue Code (26 U.S.C. 6103(m)(7)),
as added by section 5111 of Public Law 101-508 (the Omnibus Budget
Reconciliation Act of 1990), to disclose this information to us for our
use in mailing the statements required by section 1143 of the Act. This
source of address information is readily available to us, i.e.,
electronically accessible, using social security numbers as
identifiers, and was clearly contemplated by Congress in the enactment
of section 6103(m)(7) of the Internal Revenue Code.
Because individuals who live in Puerto Rico, the Virgin Islands,
and Guam generally are not required to pay Federal income taxes, the
IRS does not have their addresses. We have arranged to use the
addresses from their local
[[Page 3788]]
taxpayer records, which the tax agencies in these three entities will
provide to us.
In these proposed regulations, we state the circumstances under
which we will not send an unrequested statement. Those circumstances,
stated in proposed Sec. 404.812(b), are based on our judgment that
sending, or attempting to send, a statement to specified categories of
individuals would not reasonably be required under section 1143 of the
Act.
We will mail the statements throughout the fiscal year, rather than
in one mass mailing. This is an administratively effective and cost-
efficient method of handling the more than 6 million statements we will
mail in fiscal year 1995 and the nearly 2 million we expect to mail in
each fiscal year 1996 through 1999. The statements we send to eligible
individuals who attain age 60 during fiscal years 1995 through 1999 or
attain age 60 by the start of fiscal year 1995 will be mailed
throughout the fiscal year so that individuals will receive statements
in the fiscal year in which they qualify to receive one, as required by
section 1143.
To implement the third phase of section 1143, i.e., sending an
annual statement to eligible individuals who are not receiving benefits
under title II of the Act, we will follow essentially the same
procedures as those for the second phase of sending statements to
eligible individuals age 60 or older, except that we will send
statements to all eligible individuals, i.e., those age 25 and older.
In the final rules we published on November 23, 1992 (57 FR 54917),
we revised Sec. 404.810 to describe an individual's right to obtain a
statement of earnings and benefit estimate, how to request it, and the
information we need to comply with the request. In a new Sec. 404.811,
we listed the information that we will furnish in the statement of
earnings and benefit estimate. Further, we revised Sec. 422.125 so that
most of the rules on statements of earnings and benefit estimates are
now located in Subpart I of Part 404.
In these proposed regulations, we are revising Sec. 404.811 for
consistency with the new Sec. 404.812, which explains the statement we
will send without a request, as required by section 1143(c) of the Act.
We will also indicate whether the individual has the required credits
(quarters of coverage) to be eligible for each type of benefit, and the
ages at which various retirement amounts are potentially payable.
When individuals request statements, they are asked for information
about when they expect to retire, i.e., stop working, how much they
earned last year, and how much they expect to earn this year and in
future years up to retirement. In Sec. 404.811, we explain that if the
individual does not already have the required credits (quarters of
coverage) to be eligible to receive benefits, we may include up to
eight additional estimated credits (four per year maximum) based on the
requester's information about earnings for last year and this year that
are not yet on our records. In addition, we state that the benefit
estimate will be based partly on the information the requester provided
about his or her planned retirement age and current and future
earnings.
For the unrequested statements, we will not have information from
the individual. Instead, we will estimate the individual's recent and
future earnings based on his or her current social security record. In
Sec. 404.812, we explain that if there are earnings recorded in either
of the two years before the year in which the individual is selected to
get a statement, we will use the same earnings amount as that recorded
in the later of these two years to project earnings for the current
year and future years when we estimate the benefits. In addition, if
the individual does not already have the required credits (quarters of
coverage) to be eligible to receive benefits, we will use that last
recorded earnings amount to estimate up to eight additional credits
(four per year) for the last year and the current year. If there are no
earnings recorded in either of the 2 years preceding the year of
selection, we will not estimate any current and future earnings or
additional credits (quarters of coverage) for the individual.
In summary, both Secs. 404.811 and 404.812 list the information
that we will include in the revised statement format. In addition,
Sec. 404.812 explains who will be sent an unrequested statement, who
will not be sent an unrequested statement, and the selection and
mailing process we will use. We are also proposing to amend
Sec. 422.125 to conform it to the changes we have described for subpart
I of part 404.
Regulatory Procedures
Executive Order 12866
The Office of Management and Budget has reviewed these rules and
determined that they do not meet the criteria for a significant
regulatory action under E.O. 12866.
Regulatory Flexibility Act
We certify that these proposed regulations will not have a
significant economic impact on a substantial number of small entities
since these regulations affect only individuals. Therefore, a
regulatory flexibility analysis as provided in Pub. L. 96-354, the
Regulatory Flexibility Act, is not required.
Paperwork Reduction Act
These proposed regulations impose no additional reporting and
recordkeeping requirements subject to Office of Management and Budget
clearance.
(Catalog of Federal Domestic Assistance Program Nos. 93.802 Social
Security-Disability Insurance; 93.803 Social Security-Retirement
Insurance; 93.805 Social Security- Survivors Insurance; 93.773
Medicare-Hospital Insurance)
List of Subjects
20 CFR Part 404
Administrative practice and procedure; Blind; Disability benefits;
Old-Age, Survivors, and Disability Insurance; Reporting and
recordkeeping requirements; Social Security.
20 CFR Part 422
Administrative practice and procedure; Freedom of information;
Organization and functions (Government agencies); Social Security.
Dated: June 28, 1994.
Shirley Chater,
Commissioner of Social Security.
Approved: August 31, 1994.
Donna E. Shalala,
Secretary of Health and Human Services.
For the reasons set out in the preamble, we propose to amend
Subpart I of Part 404 of 20 CFR Chapter III and Subpart B of Part 422
of 20 CFR Chapter III as follows:
PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE
(1950- )
1. The authority citation for Subpart I of Part 404 continues to
read as follows:
Authority: Secs. 205(a), (c)(1), (c)(2)(A), (c)(4), (c)(5),
(c)(6), and (p), 1102 and 1143 of the Social Security Act; 42 U.S.C.
405(a), (c)(1), (c)(2)(A), (c)(4), (c)(5), (c)(6), and (p), 1302,
and 1320b-13.
2. Section 404.811 is revised to read as follows:
Sec. 404.811 The statement of earnings and benefit estimates you
requested.
(a) General. After receiving a request for a statement of earnings
and the information we need to comply with the request, we will provide
you or your authorized representative a statement of the earnings we
have credited to your record at the time of your request. With the
statement of earnings, we will include estimates of the benefits
[[Page 3789]]
potentially payable on your record, unless you do not have the required
credits (quarters of coverage) for any kind of benefit(s). (However,
see paragraph (b)(3) of this section regarding the possibility of our
estimating up to eight additional credits on your record.) If we do not
provide a statement of earnings and an estimate of all the benefits
potentially payable, or any other information you requested, we will
explain why.
(b) Contents of statement of earnings and benefit estimate. The
statement of your earnings and benefit estimates will contain the
following information:
(1) Your social security taxed earnings as shown by our records as
of the date of your request;
(2) An estimate of the social security and medicare hospital
insurance taxes paid on your earnings (although we do not maintain tax
information);
(3) The number of credits, i.e., quarters of coverage, not
exceeding 40, you have for both social security and medicare hospital
insurance purposes, and the number you need to be eligible for social
security and also for medicare hospital insurance coverage. If you do
not already have the required credits (quarters of coverage) to be
eligible to receive social security benefits and medicare hospital
insurance coverage, we may include up to eight additional estimated
credits (four per year) based on the earnings you told us you had for
last year and this year that we have not yet entered on your record;
(4) A statement as to whether you meet the credits (quarters of
coverage) requirements, as described in subpart B of this part, for
each type of social security benefit when we prepare the benefit
estimates, and also whether you are eligible for medicare hospital
insurance coverage;
(5) Estimates of the monthly retirement (old-age), disability,
dependents' and survivors' insurance benefits potentially payable on
your record if you meet the credits (quarters of coverage)
requirements. The benefit estimates we send you will be based partly on
your stated earnings for last year (if not yet on your record), your
estimate of your earnings for the current year and for future years
before you plan to retire, and on the age at which you plan to retire.
The estimate will include the retirement (old-age) insurance benefits
you could receive at age 62 (or your current age if you are already
over age 62), at full retirement age (currently age 65 to 67, depending
on your year of birth) or at your current age if you are already over
full retirement age, and at age 70;
(6) A description of the coverage under the medicare program;
(7) A reminder of your right to request a correction of your
earnings record; and
(8) A remark that an annually updated statement is available on
request.
3. Section 404.812 is added to read as follows:
Sec. 404.812 Statement of earnings and benefit estimates sent without
request.
(a) Who will be sent a statement. Unless one of the conditions in
paragraph (b) of this section applies to you, we will send you, without
request, a statement of earnings and benefit estimates if:
(1) You have a social security account number;
(2) You have wages or net earnings from self-employment on your
social security record;
(3) You have attained age 60 or older by October 1, 1994; you
attain age 60 after October 1, 1994, but before October 1, 1999; or,
beginning October 1, 1999, you have attained age 25 or older;
(4) We can determine your current mailing address.
(b) Who will not be sent a statement. We will not send you an
unrequested statement if any of the following conditions apply:
(1) You do not meet one or more of the conditions of paragraph (a)
of this section;
(2) Our records contain a notation of your death;
(3) You are entitled to benefits under title II of the Act;
(4) We have already sent you a statement, based on your request, in
the fiscal year we selected you to receive an unrequested statement;
(5) We cannot obtain your address (see paragraph (c)(2) of this
section); or
(6) We are correcting your social security earnings record when we
select you to receive a statement of earnings and benefit estimates.
(c) The selection and mailing process. Subject to the provisions of
paragraphs (a) and (b) of this section, we will use the following
process for sending statements without requests:
(1) Selection. We will use our records of assigned social security
account numbers to identify individuals to whom we will send
statements.
(2) Addresses. If you are living in one of the 50 States, our
current procedure is to get your address from individual taxpayer files
of the Internal Revenue Service, as authorized by section 6103(m)(7) of
the Internal Revenue Code (26 U.S.C. 6103(m)(7)). If you live in Puerto
Rico, the Virgin Islands, or Guam, we will get your address from the
taxpayer records of the Territory in which you live.
(3) Age. If you have attained age 60 by October 1, 1994, we will
send you a statement on or before September 30, 1995. If you attain age
60 after October 1, 1994 but before October 1, 1999, we will send you a
statement in the fiscal year, i.e., October 1 through September 30, in
which you attain age 60. In either case, we will inform you that an
annually updated statement is available on request. Beginning October
1, 1999, we will send you a statement each year in which you are age 25
or older.
(4) Ineligible. If we do not send you a statement because one or
more conditions in paragraph (b) of this section apply when you are
selected, we will send a statement in the first appropriate fiscal year
thereafter in which you do qualify.
(5) Undeliverable. If the statement we send you is returned by the
Post Office as undeliverable, we will not remail it.
(d) Contents of statement of earnings and benefit estimates. To
prepare your statement and estimate your benefits, we will use the
earnings on our records. If there are earnings recorded for you in
either of the 2 years before the year in which you are selected to get
a statement, we will use the later of these earnings as your earnings
for the current year and future years when we estimate your benefits.
In addition, if you do not already have the required credits (quarters
of coverage) to be eligible to receive benefits, we will use that last
recorded earnings amount to estimate up to eight additional credits
(four per year) for last year and the current year if they are not yet
entered on your record. If there are no earnings entered on your record
in either of the two years preceding the year of selection, we will not
estimate current and future earnings or additional credits for you.
Your earnings and benefit estimate statement will contain the following
information:
(1) Your social security taxed earnings as shown by our records as
of the date we select you to receive a statement;
(2) An estimate of the social security and medicare hospital
insurance taxes paid on your earnings (although we do not maintain tax
information);
(3) The number of credits, i.e., quarters of coverage, not
exceeding 40 (as described in paragraph (d) of this section), that you
have for both social security and medicare hospital insurance purposes,
and the number you need to be eligible for social security benefits and
also for medicare hospital insurance coverage;
(4) A statement as to whether you meet the credit (quarters of
coverage) requirements, as described in subpart B of this part, for
each type of social security benefit when we prepare the
[[Page 3790]]
benefit estimates, and also whether you are eligible for medicare
hospital insurance coverage;
(5) Estimates of the monthly retirement (old-age), disability,
dependents' and survivors' insurance benefits potentially payable on
your record if you meet the credits (quarters of coverage)
requirements. If you are age 50 or older, the estimates will include
the retirement (old-age) insurance benefits you could receive at age 62
(or your current age if you are already over age 62), at full
retirement age (currently age 65 to 67, depending on your year of
birth) or at your current age if you are already over full retirement
age, and at age 70. If you are under age 50, instead of estimates, we
may provide a general description of the benefits (including auxiliary
benefits) that are available upon retirement.
(6) A description of the coverage provided under the medicare
program;
(7) A reminder of your right to request a correction of your
earnings record; and
(8) A remark that an annually updated statement is available on
request.
PART 422--ORGANIZATION AND PROCEDURES
1. The authority citation for Subpart B of Part 422 continues to
read as follows:
Authority: Secs. 205, 1102, and 1143 of the Social Security Act;
42 U.S.C. 405, 1302, and 1320b-13.
2. Section 422.125 is amended by revising paragraphs (a) and (b) to
read as follows:
Sec. 422.125 Statement of earnings; resolving earnings discrepancies.
(a) Obtaining a statement of earnings and estimated benefits. An
individual may obtain a statement of the earnings on his earnings
record and an estimate of social security benefits potentially payable
on his record either by writing, calling, or visiting any social
security office, or by waiting until we send him one under the
procedure described in Sec. 404.812. An individual may request this
statement by completing the proper form or by otherwise providing the
information the Social Security Administration requires, as explained
in Sec. 404.810(b).
(b) Statement of earnings and estimated benefits. Upon receipt of
such a request or as required by section 1143(c) of the Social Security
Act, the Social Security Administration will provide the individual,
without charge, a statement of earnings and benefit estimate or an
earnings statement. See Secs. 404.810ff concerning the information
contained in these statements.
* * * * *
[FR Doc. 95-1309 Filed 1-18-95; 8:45 am]
BILLING CODE 4190-29-P
