[Federal Register Volume 75, Number 34 (Monday, February 22, 2010)]
[Rules and Regulations]
[Pages 7552-7555]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-3383]


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SOCIAL SECURITY ADMINISTRATION

20 CFR Part 416

[Docket No. SSA-2008-0051]
RIN 0960-AF97


Exclusion of Certain Military Pay From Deemed Income and 
Resources

AGENCY: Social Security Administration.

ACTION: Final rule.

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SUMMARY: We are revising our rules to clarify that, for Supplemental 
Security Income (SSI) purposes, we do not consider any combat-related 
military pay as income when we determine whether spouses and children 
of members of the uniformed services are eligible for SSI. The rules 
also clarify that we do not consider combat-related military pay as 
income when we determine the spouse's or child's proper payment amount. 
These rules also provide that, when we determine whether spouses and 
children are eligible for SSI, we do not consider retroactive payments 
of certain military pay as resources for 9 months following receipt. 
These final rules protect spouses and children of members of the 
uniformed services from a reduction in, or loss of, benefits because 
their spouse or parent serves in a combat zone.

DATES: This final rule will be effective March 24, 2010.

FOR FURTHER INFORMATION CONTACT: Eric Skidmore, Social Insurance 
Specialist, Social Security Administration, Office of Income Security 
Programs, 252 Altmeyer Building, 6401 Security Boulevard, Baltimore, MD 
21235-6401, (410) 597-1833. For information on eligibility or filing 
for benefits, call our national toll-free number, 1-800-772-1213 or TTY 
1-800-325-0778, or visit our Internet site, Social Security Online, at 
http://www.socialsecurity.gov.

SUPPLEMENTARY INFORMATION:

Electronic Version

    The electronic file of this document is available on the date of 
publication in the Federal Register at http://www.gpoaccess.gov/fr/index.html.

Background

    The SSI program provides a minimum income level for aged, blind, 
and disabled persons who do not have income or resources above levels 
specified in the Social Security Act (the Act). The Act generally 
requires that when we determine a person's eligibility for, and amount 
of, SSI benefits, we must consider the income and resources of an 
ineligible spouse living in the same household and, in the case of a 
child under the age of 18, an ineligible parent living in the same 
household (and the spouse of such a parent). Section 1614(f) of the 
Act, 42 U.S.C. 1382c(f). We use the term ``deeming'' to refer to the 
process of considering part of an ineligible spouse's or parent's 
income and resources to be the person's own income and resources.
    Although a member of the uniformed services on active duty is 
unlikely to apply or be eligible for SSI benefits, some members of the 
uniformed services have spouses or children who receive or may apply 
for SSI benefits. For purposes of deeming, the Act provides that a 
spouse or parent who is absent from the household solely because of a 
duty assignment as a member of the Armed Forces generally will be 
treated as if he or she were living in the household. Section 
1614(f)(4) of the Act, 42 U.S.C. 1382c(f)(4). Therefore, we generally 
deem income and resources of the member of the uniformed services to 
his or her spouse or child when determining the spouse's or child's 
eligibility for, and amount of, SSI benefits. Because we consider the 
member of the uniformed services as part of the household, we do not 
treat his or her military pay as unearned income from a source outside 
of the household.
    Although we generally deem income of a member of the uniformed 
services

[[Page 7553]]

to his or her spouse or child, the Act excludes from income certain 
kinds of pay that members of the uniformed services may receive. 
Section 1612(b)(20) of the Act, 42 U.S.C. 1382a(b)(20). In particular, 
we exclude from income special pay received pursuant to 37 U.S.C. 310. 
Members of the uniformed services are eligible for special pay during 
months in which they are subject to hostile fire or certain other 
dangerous conditions specified in 37 U.S.C. 310. Our current 
regulations implementing section 1612(b)(20) of the Act exclude 
``hostile fire pay'' received under 37 U.S.C. 310 from income and from 
deeming to spouses and children. 20 CFR 416.1124(c)(19) and 
416.1161(a)(23). We are replacing the term ``hostile fire pay'' in 
these sections of our rules with the term ``special pay'' to clarify 
that we exclude from income all special pay that a member of the 
uniformed services received pursuant to 37 U.S.C. 310.
    We are also adding a new paragraph to our rules on deeming of 
income to spouses and children that excludes from deeming additional 
types of combat-related pay beyond special pay under 37 U.S.C. 310. The 
Act allows us to waive the deeming of income and resources to a spouse 
or child when we determine that deeming would be inequitable. Section 
1614(f) of the Act, 42 U.S.C. 1382c(f). Effective October 1, 2002, we 
issued instructions under this statutory authority to exclude from a 
spouse's or child's deemed income any additional pay that members of 
the uniformed services received because they were deployed to or served 
in a combat zone. We determined that it would be inequitable to deem 
that pay as income and reduce a family member's benefits or potentially 
render the family member ineligible for SSI. We are now incorporating 
this exclusion and the definition of the term ``combat zone'' in our 
SSI rules.
    We are also revising our rules on deeming of resources to spouses 
and children to exclude retroactive payments of certain kinds of 
military pay for 9 months following receipt. Congress has retroactively 
and permanently increased the amount of special pay under 37 U.S.C. 310 
and the family separation allowance under 37 U.S.C. 427. Pursuant to 
section 1614(f) of the Act, we issued instructions excluding 
retroactive payments of the increase in special pay received after 
September 2002 from a spouse's or child's deemed resources for a period 
of 9 months following the month of receipt. Our instructions similarly 
excluded retroactive payments of the family separation allowance that a 
member of the uniformed services received as a result of deployment to 
or service in a combat zone. We determined that it would be inequitable 
to apply the usual resource deeming rules to these retroactive payments 
in recognition of the hardships experienced and sacrifices made by 
members of the uniformed services and their families. We are now 
revising our SSI rules to incorporate these exclusions.
    Finally, we are revising the punctuation at the conclusion of Sec.  
416.1161(a)(25), (a)(26), and (a)(27). We are also clarifying some of 
the language in Sec.  416.1202(a) and (b)(1) and reorganizing portions 
of Sec.  416.1202(b)(1) to make that section easier to understand. We 
are making these changes solely to improve the clarity of these rules, 
and these changes have no substantive effect on our policies or 
procedures.

Explanation of Changes

    We are amending the regulations in 20 CFR, part 416, subparts K and 
L, to reflect the changes discussed above. In summary, we are:
    1. Revising Sec.  416.1124(c)(19) and Sec.  416.1161(a)(23) to 
replace the term ``hostile fire pay'' with the term ``special pay.'' We 
are making this technical clarification to conform the regulatory 
language to the statutory language in section 1612(b)(20) of the Act.
    2. Amending Sec.  416.1160(d) to add a definition of the term 
``combat zone.''
    3. Amending Sec.  416.1161 by adding new paragraph (a)(28) to 
exclude from income deemed from an ineligible spouse or parent any 
additional increment in pay, other than any increase in basic pay 
(e.g., annual pay raises, promotions), if:
    <bullet> The spouse or parent received the additional pay as a 
result of deployment to or service in a combat zone; and
    <bullet> The spouse or parent was not receiving the additional pay 
immediately prior to deployment to or service in a combat zone.
    4. Revising the punctuation at the conclusion of paragraphs 
(a)(25), (a)(26), and (a)(27) of Sec.  416.1161.
    5. Revising paragraphs (a) and (b)(1) of Sec.  416.1202 to exclude 
from resources deemed from an ineligible spouse or parent (or spouse of 
a parent), for 9 months following the month of receipt, the unspent 
portion of any retroactive payment of:
    <bullet> Special pay the ineligible spouse or parent received from 
one of the uniformed services pursuant to 37 U.S.C. 310; and
    <bullet> Family separation allowance the ineligible spouse or 
parent received from one of the uniformed services pursuant to 37 
U.S.C. 427 as a result of deployment to or service in a combat zone.
    6. Clarifying some language in paragraphs (a) and (b)(1) of Sec.  
416.1202, and reorganizing portions of paragraph (b)(1).

Public Comments

    In the notice of proposed rulemaking we published at 74 FR 27727 
(June 11, 2009), we provided the public with a 60-day period in which 
to comment on the proposed changes. That comment period ended on August 
10, 2009. We did not receive any comments on the proposed changes. We 
are changing our rules exactly as we proposed in the notice of proposed 
rulemaking.

Regulatory Procedures

Executive Order 12866

    We have consulted with the Office of Management and Budget (OMB) 
and determined that these final rules meet the requirements for a 
significant regulatory action under Executive Order 12866, as amended. 
Thus, they were subject to OMB review.

Regulatory Flexibility Act

    We certify that these final rules will not have a significant 
economic impact on a substantial number of small entities, because they 
affect only individuals. Therefore, a regulatory flexibility analysis 
as provided in the Regulatory Flexibility Act, as amended, is not 
required.

Paperwork Reduction Act

    These final rules impose no reporting or recordkeeping requirements 
subject to OMB clearance.

(Catalog of Federal Domestic Assistance Program No. 96.006, 
Supplemental Security Income)

List of Subjects in 20 CFR Part 416

    Administrative practice and procedure; Aged, Blind, Disability 
benefits; Public assistance programs; Reporting and recordkeeping 
requirements; Supplemental Security Income (SSI).

    Dated: November 9, 2009.
Michael J. Astrue,
Commissioner of Social Security.


0
For the reasons set out in the preamble, we amend subparts K and L of 
part 416 of chapter III of title 20 Code of Federal Regulations as set 
forth below:

[[Page 7554]]

PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND 
DISABLED

Subpart K--[Amended]

0
1. The authority citation for subpart K of part 416 continues to read 
as follows:

    Authority: Secs. 702(a)(5), 1602, 1611, 1612, 1613, 1614(f), 
1621, 1631, and 1633 of the Social Security Act (42 U.S.C. 
902(a)(5), 1381a, 1382, 1382a, 1382b, 1382c(f), 1382j, 1383, and 
1383b); sec. 211, Pub. L. 93-66, 87 Stat. 154 (42 U.S.C. 1382 note).


0
2. Amend Sec.  416.1124 by revising paragraph (c)(19) to read as 
follows:


Sec.  416.1124  Unearned income we do not count.

* * * * *
    (c) * * *
    (19) Special pay received from one of the uniformed services 
pursuant to 37 U.S.C. 310;
* * * * *

0
3. Amend Sec.  416.1160 by adding the definition of ``Combat zone'' in 
paragraph (d) to read as follows:


Sec.  416.1160  What is deeming of income?

* * * * *
    (d) * * *
    Combat zone means
    (i) Any area the President of the United States designates by 
Executive Order under 26 U.S.C. 112 as an area in which Armed Forces of 
the United States are or have engaged in combat;
    (ii) A qualified hazardous duty area (QHDA) Congress designates be 
treated in the same manner as an area designated by the President under 
26 U.S.C. 112, provided the member of the uniformed services serving in 
this area is entitled to special pay under 37 U.S.C. 310; or
    (iii) An area where the Secretary of Defense or his or her 
designated representative has certified that Armed Forces members 
provide direct support for military operations in an area designated by 
the President under 26 U.S.C. 112 or a QHDA, provided the member of the 
uniformed services serving in the area certified by the Secretary of 
Defense or his or her designated representative is entitled to special 
pay under 37 U.S.C. 310.
* * * * *

0
4. Amend Sec.  416.1161 as follows:
0
a. Amend paragraph (a)(23) by removing the words ``Hostile fire pay'' 
and adding the words ``Special pay'' in their place;
0
b. Remove the word ``and'' at the end of paragraph (a)(25);
0
c. Remove the period at the end of paragraph (a)(26) and add a 
semicolon in its place;
0
d. Remove the period at the end of paragraph (a)(27) and add ``; and'' 
in its place; and
0
e. Add paragraph (a)(28) to read as follows:


Sec.  416.1161  Income of an ineligible spouse, ineligible parent, and 
essential person for deeming purposes.

* * * * *
    (a) * * *
    (28) Any additional increment in pay, other than any increase in 
basic pay, received while serving as a member of the uniformed 
services, if--
    (i) Your ineligible spouse or parent received the pay as a result 
of deployment to or service in a combat zone; and
    (ii) Your ineligible spouse or parent was not receiving the 
additional pay immediately prior to deployment to or service in a 
combat zone.
* * * * *

Subpart L--[Amended]

0
5. The authority citation for subpart L of part 416 continues to read 
as follows:

    Authority: Secs. 702(a)(5), 1602, 1611, 1612, 1613, 1614(f), 
1621, 1631, and 1633 of the Social Security Act (42 U.S.C. 
902(a)(5), 1381a, 1382, 1382a, 1382b, 1382c(f), 1382j, 1383, and 
1383b); sec. 211, Pub. L. 93-66, 87 Stat. 154 (42 U.S.C. 1382 note).


0
6. In Sec.  416.1202:
0
a. Revise the second sentence and remove the third sentence of 
paragraph (a);
0
b. Add new paragraphs (a)(1), (a)(2), and (a)(3); and
0
c. Revise paragraph (b)(1).
    The additions and revisions read as follows:


Sec.  416.1202  Deeming of resources.

    (a) * * * In addition to the exclusions listed in Sec.  416.1210, 
we also exclude the following items:
    (1) Pension funds that the ineligible spouse may have. Pension 
funds are defined as funds held in individual retirement accounts 
(IRA), as described by the Internal Revenue Code, or in work-related 
pension plans (including such plans for self-employed persons, 
sometimes referred to as Keogh plans);
    (2) For 9 months beginning with the month following the month of 
receipt, the unspent portion of any retroactive payment of special pay 
an ineligible spouse received from one of the uniformed services 
pursuant to 37 U.S.C. 310; and
    (3) For 9 months beginning with the month following the month of 
receipt, the unspent portion of any retroactive payment of family 
separation allowance an ineligible spouse received from one of the 
uniformed services pursuant to 37 U.S.C. 427 as a result of deployment 
to or service in a combat zone (as defined in Sec.  416.1160(d)).
    (b) * * *
    (1) General. In the case of a child (as defined in Sec.  416.1856) 
who is under age 18, we will deem to that child any resources, not 
otherwise excluded under this subpart, of his or her ineligible parent 
who is living in the same household with him or her (as described in 
Sec.  416.1851). We also will deem to the child the resources of his or 
her ineligible stepparent. As used in this section, the term ``parent'' 
means the natural or adoptive parent of a child, and the term 
``stepparent'' means the spouse (as defined in Sec.  416.1806) of such 
natural or adoptive parent who is living in the same household with the 
child and parent. We will deem to a child the resources of his or her 
parent and stepparent whether or not those resources are available to 
him or her. We will deem to a child the resources of his or her parent 
and stepparent only to the extent that those resources exceed the 
resource limits described in Sec.  416.1205. (If the child is living 
with only one parent, we apply the resource limit for an individual. If 
the child is living with both parents, or the child is living with one 
parent and a stepparent, we apply the resource limit for an individual 
and spouse.) We will not deem to a child the resources of his or her 
parent or stepparent if the child is excepted from deeming under 
paragraph (b)(2) of this section. In addition to the exclusions listed 
in Sec.  416.1210, we also exclude the following items:
    (i) Pension funds of an ineligible parent (or stepparent). Pension 
funds are defined as funds held in IRAs, as described by the Internal 
Revenue Code, or in work-related pension plans (including such plans 
for self-employed persons, sometimes referred to as Keogh plans);
    (ii) For 9 months beginning with the month following the month of 
receipt, the unspent portion of any retroactive payment of special pay 
an ineligible parent (or stepparent) received from one of the uniformed 
services pursuant to 37 U.S.C. 310; and
    (iii) For 9 months beginning with the month following the month of 
receipt, the unspent portion of any retroactive payment of family 
separation allowance an ineligible parent (or stepparent) received from 
one of the uniformed services pursuant to 37 U.S.C. 427 as a result of 
deployment to or service in a

[[Page 7555]]

combat zone (as defined in Sec.  416.1160(d)).
* * * * *

[FR Doc. 2010-3383 Filed 2-19-10; 8:45 am]
BILLING CODE 4191-02-P