# United States Court of Appeals

For the Seventh Circuit Chicago, Illinois 60604

Submitted November 9 , 2022 * Decided November 10, 2022

Before

FRANK H. EASTERBROOK , Circuit Judge

DAVID F. HAMILTON , Circuit Judge

THOMAS L. KIRSCH II , Circuit Judge

No. 22-1441

R EBECCA I. HARP , Plaintiff -Appellant ,

v

.
KILOLO KIJAKAZI, Acting Commissioner of Social Security , Defendant -Appellee

. Appeal from the United States District Court for the Eastern District of Wisconsin

.

No. 20-C-1743

Lynn Adelman , Judge

.

O R D E R
The Social Security Administrati on reopened Rebecca Harp’s application for disability insurance benefits b ased on evidence that she had concealed income , and relying on that evidence, it revoked her benefits . Harp argu es that the agency wrongly reopened her case and that the money she conc ealed was not from substantial gainful

* We have agreed to decide the case without oral argument because the briefs and record adequately present the facts and legal arguments, and oral argument would not significantly aid the court. F ED

. R. A PP

. P. 34(a)(2)(C). NONPRECEDENTIAL DISPOSITION To be cited only in accordance with F ED

. R. A PP

. P. 32.1No. 22-1441 Page 2

activity and th us did not affect her eligibility for benefits . Because substantial evidence supports the agency’s contrary findings , we affirm.
Harp’s adult daughter , Nashawn, is disabled and requires extensive care. S tate programs in Wisconsin will pay caregivers , including family members, for at- home

care . In 2014, Harp selected herself and her other daughter as Nashawn’s caregivers and received money through a state program . A fter a payment issue arose with that pro gram , Harp enrolled Nashawn in a different program and again selected herself as a caregiver. Th at program paid family members for services that “exceed the typical care

giving/support responsibility” of family members , such as toileting, bathing, assistin g with complete transfer s, and other “unique services.” Case managers regularly assess ed whether payments to Harp were proper under this standard

. Harp earned , on average, thousands of dollars per month from both programs in 2014 and 2015.
While Harp was receiving this money from the state programs, she applied for federal disability insurance benefits based on a spine injury

. Her i ncome and work history are relevant to her eligibility for benefits. See 20 C.F.R. §§ 404.1572, 404.1574(a). At her hearing before an administrative law judge, Harp did not disclose receiving any money from the se state programs ; nor did she list her caregiving work in her “Claimant’s Work Background ,” a form that she signed with her application. Unaware of these omissions , the ALJ ruled in 2015 that she was disabled and eligible for benefits. She began receiving benefits shortly afterward.

A few years later , the Social Security Administration learned of Harp’s income from the state programs and halt ed her benefits . Harp received a letter from the agency in April 2019 warning that she would no longer receive disability benefits. The agency explained that it w as reopen ing the disability ruling bas ed on evidence (pay stubs from the state programs listing Harp as an “employee” and itemizing her “gross wages” ) that Harp had wrongly concealed earnings

. Her benefits temporarily resumed, though, after she requested reconsideration. A month b efore the hearing on the reo pened case , the agency wrote that she would receiv e disability payment s that she was “due.”
The hearing came next. Harp swore that she never performed caregiving tasks for Nashawn and could not perform certain tasks (like picking Nashawn up) because of her spinal injury

. When asked why the state paid her thousands of dollars month ly , she admitted that it paid her for the overnight hours “ monitoring ” Nashawn and changing her diapers whe n no other caregiver was present . She concede d that , if she did not do this monitoring , the state w ould have paid another caregiver for it

. But, Harp insisted , she did not need to disclose t he payments because they were not “ wages ” for work butNo. 22-1441 Page 3

a “ stipend ” for “ a home” ; the state programs did not report it to the Social Security Administration ; and an IRS agent told her that she did not need to pay taxes on it

. Finally, Nashawn ’s daytime caregiver testified that she did not observe Harp car ing for her daughter while th at caregiver was present.

T he ALJ ruled against Harp , conclud ing that she had engaged in substantial gainful activity and earn ed , on average, thousands of dollars month ly for caregiving services. 20 C.F.R. §§ 404.1572, 404.1574(a). This activity and the income it generated meant that she was not disabled and was ineligible for disability insurance benefits. 20 C.F.R. § 404.1520(b). S ee SSA, Substantial Gainful Activity, available at https://www.ssa.gov/oact/cola/sga.html (listing the disqualifying amounts as earnings between $1,070 and $1,130 per month from 2014 to 2016) (last accessed October 7, 2022). The Appeals Council denied Harp’s request for review, and the district cour t upheld
t he ALJ’s order. We review the district court’s ruling de novo , Jarnutowski v. Kijakazi , 48 F.4th 769, 773 (7th Cir. 2022), and uphold the ALJ’s decision if it is supported by substantial evidence. 42 U.S.C. § 405(g); Biestek v. Berryhill , 139 S. Ct. 1148, 1152 (2019).
On appeal, Harp takes aim at the decision to reopen her case. In her view, the letter that she received a month before the hearing , promising that she would receive resumed benefits that she was due , was the “ fi nal ” decision of the agency

. But the letter does not purport to be final , and it did not cancel the upcoming hearing on her reopened case to decide what benefits she was due

. Moreover , the standard for

“ reopening ” was met here. D eterminations about benefits may be “reopened” “[a]t any time if

— (1) It was obtained by fraud or similar fault.” 20 C.F.R. § 404.988 (c)(1). T he letter notifying Harp of the agency’s decision to reopen her case was supported by ample evidenc e of “fraud or similar fault .” Th e e vidence included t he pay stubs from state programs list ing Harp as an “employee” and the “ wages ” th ey pai d her at the very time she claimed that she was not working . In her reply brief, Harp argues for the first time that these pay statements are “fabricated.” B ut this argument is unsubstantiated, and she waived it because she did not raise it before the district court or in her opening brief. See Wonsey v. City of Chicago , 940 F.3d 394, 398 (7th Cir. 2019).
Harp next reprises her contention that the ALJ wrongly decided to cancel her benefits because , in her view, the income she received from the state care programs was
not for substantial gainful activity

. She revisits the reasons she gave to the ALJ , but they are all unavailing. First, s he contends that the income did not dis qualify her from benefits because it was not taxable . B ut the regulations describe substantial gainfulNo. 22-1441 Page 4

activity as “work that is usually done for pay or profit ” and make no distinction between taxable income and non -t axable income . 20 C.F.R. § 404.1572(b).

Second, s he argues that her assertion that her spinal injury prevented her from caring for her daughter, and the daytime caregiver ’s testimony , support Harp’s view that she did no care giving. But t he ALJ was not required to believe Harp’s assertion , and other evidence amply refuted it

. See Stepp v. Colvin , 795 F.3d 711, 720 (7th Cir. 2015). For instance, the ALJ permissibly relied on Harp’s admission that when she

“ monitored ” Nashawn a ll night, incl uding changing her diaper s , she performed tasks for which the state would otherwise pay non

- family member s. And the state programs , which paid family members only for care giving work not normally provided by f amil ies, r egularly assessed whether they paid Harp according to those restrictions

. As for the other caregiver’s testimony that she did not observe Harp caring for Nashawn , the ALJ reasonably discounted it because Harp was paid for the hours when the daytime caregiver was not present and could n ot observe her.
Finally , Harp attempts to characterize her earnings as a “stipend” for giving her daughter a place to live

— in other words, the state paid for Nashawn’s rent. But the record contains substantial evidence that the state programs paid recipie nts only for services , not for housing.

AFFIRMED