Getting Started

The Award Letter
Your assigned PASS Cadre Specialist will send you a letter stating that your PASS has been approved. If your PASS plan was approved retroactively, the PASS Specialist will indicate that you will be receiving a back payment of SSI and remind you that this should be deposited into your PASS account upon receipt.

The award letter will specify:

Which expenses are approved;
The amount approved for each expense;
How often you are expected to spend this amount;
When to expect your first PASS review; and
What documents they will be requesting from you so you can be prepared.

Place this letter in your binder or folder where you will track your expenses and payments. It will be useful to refer to it later.

Establishing a Bank Account
The first step, if you have not already done so, is to establish an account where you will keep your sheltered PASS money. This money must not be mixed with any other money and may only be used for the approved expenses. The PASS account can be either a savings or checking account. With either account you will need to have signed receipts of services rendered and payments made. Some people find checking accounts easier if they are making frequent payments since the canceled checks can serve as receipts for payments made. If you use a savings account you will need copies of money orders to document payments you have made. Create a paper trail of all of your deposits, withdrawals, and payments.

What gets deposited in the account?
In Part V, (example in Appendix A, pg 29), of your plan you indicated how much money you will deposit monthly into your PASS account. If you want to change this amount at any time, contact the PASS Cadre first to have the plan amended. For example, if your wages increase you can change the amount that you shelter each month.

If in Part V, you indicated that you want to shelter “all countable income,” this amount may change monthly if you are paid hourly (i.e., depending on the number of hours you worked in a month), but the calculations are fairly straightforward. In this case you will not need to contact the Cadre when your income changes.

Calculations
Remember that all calculations regarding Social Security are done on gross wages. Families have stated that creating a reminder calculation sheet which shows you exactly what to deposit monthly or writing the formula on the folder where you store your PASS receipts is very helpful (see Appendix B). The calculations to determine your countable income or how much you can deposit into your PASS account are different depending on which disability benefits you receive from Social Security.

Scenario A

If you receive SSI and wages only, with no other unearned income, and you are sheltering all countable wages, calculate your total gross wages for the month, subtract $85 (SSA excludes this amount when determining the amount of your SSI check), and divide the remaining amount by 2. If you receive more than one paycheck each month, subtract $85 from the first check only and then divide by 2 to determine your countable income for that check. For the additional checks for that same month divide the gross amount of each check by 2 to determine countable earned income for each pay period. Add together the countable earned income for each pay period in the month. This sum is the amount of your countable earned income for the entire month. Deposit this amount into your PASS account.

A. Total gross wages for month less (-) $85
Divide this amount by 2 = Total Countable Earned Income
Or,
B. Take the 1st check of the month gross wages less (-) $85 and divide by 2. Add to this amount all subsequent checks divided by 2 = Total Countable Earned Income

Math illustrations:
Mike and George shelter all their countable income

A. Mike is paid monthly. He earns $475.00 gross wages a month and is paid at the of the month

$475.00 - $85.00 = $390.00
$390.00 ÷ 2 = $195.00

Mike’s Countable Earned Income for the month is $195.00.

B. George is paid weekly. He earned $105.00 the first week, $90.00 the second week, $107.00 the third week, and $98.00 the last week of the month.

     $105.00 - $85.00 = $20.00,    $20.00 ÷ 2 = $10.00
     $90.00 + $107.00 + $98.00 = $295.00,     $295.00 ÷ 2 = $147.50
     $10.00 + $147.50 = $157.50

George’s Countable Earned Income for the month is $157.50 (remember to only subtract $85.00 one time per month).

There is an exception for a PASS plan for a small business that averages the entire year’s net earnings from self-employment (NESE), which is based on Gross Sales minus (-) IRS deductible business expenses times (x) .9235 divided (÷) by 12. The result is thus spread evenly over every month based on predicted NESE and later on actual NESE when the business owner files her/his IRS taxes. It’s very different than wages, which are counted exactly when they are received each month.

For example:
$20,000 gross sales - $10,000 IRS deductible business expenses = $10,000 Net Profit
$10,000 x .9235 = $9,235 NESE
$9,235 ÷ 12 = $769.58 per month NESE

If the person is just receiving SSI & NESE, then the standard PASS formulas apply next:
$796.58 - $85 = $648.58
$684.58 ÷ 2 = $342.29 PASS deposit each month.

Scenario B

If you are going to shelter unearned income such as Social Security Disability Insurance, Survivor’s Benefits, or benefits as a disabled adult child, this amount will be consistent month to month until you receive your cost of living adjustment in January of each year. The total unearned income less $20 is countable unearned income. Any portion of this can be sheltered in the PASS.

Total unearned income check less (-) $20 = Total Countable Unearned Income

For Example:
Mary receives $328.00 in Social Security Disability Insurance each month.

$328.00 - $20.00 = $308.00

Mary’s Countable Unearned Income that she deposits into her PASS account each month is $308.00

The cleanest accounting is to have the entire SSDI check deposited into your personal account and then transfer the $308 dollars to your PASS account

Scenario C

If you are sheltering both wages and unearned income, calculate the amount of countable earned income by adding up your gross monthly income, subtracting $65, and then dividing this amount by 2. This amount is your total countable earned income. The countable unearned income will be the unearned income amount less $20. Deposit both amounts into your PASS account monthly.

Total unearned income check less (-) $20 = Total Countable Unearned Income
Total gross wages for month less (-) $65

For Example:
Gary receives 452.00 in survivor’s benefits each month. He also earns $263.00 gross wages a month.

$452.00 - $20.00 = $432.00 (Countable Unearned Income)
$263.00 - $65.00 = $198.00
$198.00 ÷ 2 = $99.00 (Countable Earned Income)
$432.00 + $99.00 = $531.00
Divide this amount by 2 = Total Countable Earned Income

Gary’s Countable Unearned Income and Countable Earned Income that he deposits each month into his PASS account is $531.00.

Scenario D

You can shelter a lump sum of money, or a resource (possibly a gift or an inheritance), through your PASS plan if it is approved by the PASS Cadre. But this means that you have committed to spend the money in this account on the expenses outlined in Part IV, (see Appendix, A pg. 27), of the PASS plan.

Whenever possible set up direct deposit into your PASS account and direct payment for services. The cleaner the paper trail, the easier it is for you and the PASS Cadre to monitor your PASS.

Setting Up Accounting Systems
The first step is to keep your PASS award letter for reference. It is your responsibility to track all of your PASS account’s deposits and withdrawals, and all expenses associated with the plan. To create a clean paper trail, begin from day one of your PASS. Bank statements can serve as records of all deposits and withdrawals, BUT YOU ALSO NEED RECEIPTS TO ACCOUNT FOR ALL PURCHASES AND EXPENSES. You should also track your monthly income and deposits into your PASS account on a ledger (see Appendix B for an example). Remember, you are always responsible for reporting wages to your local SSA field office by the 10th of the following month to enable them to calculate how much SSI you are due. Technically, if you are sheltering all of your countable earned income your SSI check should remain at the Federal Benefit Rate of $564/month in 2004, but unfortunately families have reported that the system doesn’t always run that smoothly.

Recommended Supplies:

Highlighter ~ to note important dates on award letter and SSA correspondence
3-part folder ~ to organize and store receipts and bank statements
Receipt book
Accounting paper
Stapler

One family uses a 3-part folder to organize their PASS information. In the front section they file the award letter, the PASS plan, and any other instructions from the Cadre. In the middle section they keep copies of their son’s weekly pay stubs and the ledger on which they record his paychecks, deposits to the PASS account and copies of his bank statements. In the final section copies of canceled checks and receipts for services or purchases are stored (see Appendix B).

Your award letter will summarize what your approved expenses are and what documentation will be requested at the time of the review. It might be helpful to summarize these crucial pieces of information on the pockets of each part of the folder (see example on page 17). Ask the PASS Cadre representative or the person who wrote your plan for assistance if you need it.

Mail from Social Security
Even if you are reporting your wages correctly and promptly to your local field office, you may still receive notices of overpayments and have reductions in your SSI check that are not accurate. The Social Security office may overestimate the amount you will earn for wages the following month and therefore reduce your SSI check. However, if you earn less than they anticipated they will owe you money and this will be returned to you in a later check.

If you report wages several times a month, you may receive several letters in response. Some people have reported getting a reduced SSI check but then a make up check later in the month or subsequent months. This is problematic if you use your SSI check to meet your monthly living expenses. Several PASS recipients whom we interviewed reported having this happen and suggested opening a back up savings account to ensure that you can pay your monthly bills. Make sure your personal account balance is less than $2000, which is the resource limit for SSI. It will help if you send a copy of your paychecks to the PASS Cadre office monthly and track the amount you should receive in SSI (see the calculation sheet in Appendix C).

Monitor your other benefits such as Section 8 housing or food stamps. Sheltered money in a PASS plan does not count against your eligibility for these programs. Section 8 and food stamps exclude PASS funds when determining a person’s eligibility and when calculating monthly housing and food benefit amounts. However, these programs may not understand what a PASS plan is and mistakenly think that you are ineligible for their assistance.

Match your receipts with your checks. (Your receipts can be originals or copies). If you are writing monthly checks for job coach support, attach your canceled check to the job coach’s bill for services. One family uses the computer program Quicken to track their PASS expenses. The check number and amount of payment for every service is entered into their accounting system. The computer accounting can be cross-checked with their bank statements during the PASS review. If you are making car payments, attach the monthly payment bill to the canceled check (or highlight the automatic payment shown on your PASS bank account statement and attach a record showing that your car loan balance is reducing). If you are paying for a service with cash or a money order, have the recipient sign a receipt for payment and attach it to their bill for service. See Appendix B for an example of a tracking system.

Transportation - If your PASS is paying for mileage, keep a calendar of which days you are attending work or school and track the mileage. The federal mileage reimbursement rate of $0.37 per mile includes car maintenance costs, gas, and insurance. As an alternative, you could choose to pay an established rate for gas or for rides. Receipts are necessary for all transactions. If your receipt is a credit card statement, you must show that the credit card debt was paid. Credit card receipts are the least desirable option for the PASS Cadre.

If you cannot provide receipts, you do not get credit for the expense and it will be considered an overpayment from SSI for that review period. You will receive a separate overpayment letter explaining the overpayment amount and how it will be recovered depending on your current SSI payment status. It could be recovered from future SSI payments if you are still eligible for SSI, or it could be recovered from future SSDI payments or IRS refunds if you are no longer receiving SSI payments and you do not send in the refund to SSA.

Documenting Milestones
When the Cadre reviews your progress, in addition to establishing that you are spending and saving your money correctly, they will want to know that you are following the milestones (which you indicated in Part III of your PASS plan) that would lead you to your work goal. Your award letter will remind you of your milestones and will indicate what documentation you will need to provide at the time of review to demonstrate you are meeting them.

If your milestones include education, you will need to document your attendance, grades, and current and future course schedule.
If your work goal involves Supported Employment and is to increase your self-sufficiency in your job, you must document that your wage increased, job duties expanded, or that job coach hours are reduced. Pay stubs or job coaching bills are sufficient documentation.
If you are buying a car or a computer, paying off the loan will be a milestone and you will include documentation of the loan being paid off.

Log notes (including dates of activities and who you contacted) can serve as documentation that you met your milestones of interviewing job coaches, setting up experience sites, or began job development. If researching costs of tools or other items is an approved activity you could include written quotes of bids from various vendors as documentation of having met that milestone.

Self-Employment
The PASS Cadre and local SSA offices ask for detailed month by month business records. The Cadre will look for you to start making a profit at least by year two. They will ask you to provide a copy of your tax returns to show your profits/losses. Future cost/profit projections are required for both SSI and SSDI PASS plans.

Reviews
Typically a review is done when your PASS first starts and then again every 6 months to a year. It is up to your individual PASS specialists to decide the frequency; however, a particular milestone may warrant a review at a different time, or if you are asking for an amendment, extension, or suspension, the review process will be triggered. Your PASS Cadre specialist will notify you by certified mail that it is time for a review. You will have 30 days to get your accounts and receipts to them by mail. Fourteen days after the first notice is sent, a reminder will be mailed stating that all documents are due. PASS reviews are never conducted in person. They are always conducted by phone and mail.

If you do not respond, your SSI can be suspended and an over-payment posted to your SSA account. If you need additional time, don’t panic! Communicate with the Cadre if you need more time to gather receipts.

Initial Progress Check
Approximately 6 weeks after approval, your Cadre representative will give you a call to verify that you have established a separate PASS bank account, that your back payment of SSI (if applicable) has been deposited into the account, and to check in with you regarding any questions.

Progress Review
The next review is a progress review and most likely will occur at six months or one year. The purpose is to ensure you are following your plan as written in terms of saving, spending, and following your milestones in pursuit of your goal. If you are not spending the amounts you stated were necessary, the Cadre may determine that these expenses were not really needed for you to attain your vocational goal and they might no longer allow you to exclude this amount. During your review, explain why you are spending at a different rate or ask for an amendment to the plan if you discover that another expense is needed more than the expense that you initially included in the budget.

Final Accounting
At the end of your PASS, a final accounting will be performed to review all of your spending, saving and progress toward your goal. See an example of a final accounting review in Appendix B, page 56.

For all reviews, you will need to send:
1. Proof of items purchased: receipts for purchases, canceled checks, statements from a 3rd party if you paid in cash, and bills for services provided.

2. Documentation that you are saving correctly and bank statements showing that correct amounts are deposited monthly, there is no co-mingling of funds, and there are no unauthorized withdrawals.

3. Documentation that you are following your plan: verification of milestones.

Keep copies of what you send to the Cadre in case things get lost. They will need originals or certified copies of all documentation. Everything will be returned to you.

It is a good idea to keep all documentation for your PASS plan until your PASS is terminated, even after the progress review is completed, just in case you or someone else requests an audit of the PASS Cadre’s decision.

No Receipts No Credit...
If you cannot account for the funds that you agreed to save in your account or you did not spend your PASS funds on approved expenses, you will be in overpayment status and required to repay SSA for the unaccounted or misappropriated funds. SSI could recover this amount by reducing your check by 10% monthly, not sending your SSDI check until the overpayment is paid off, or confiscating your tax refund to pay off the overpayment. Social Security tries to collect overpayments within 36 months.

Extension, Suspension, Amendment
If you need more time to reach your goal, you can request an extension of the PASS plan. If you cannot pursue your plan (typically due to medical reasons), you can request a suspension for up to 12 months or possibly longer. If you need to change anything in your plan, you need to talk with the Cadre representative to amend the original plan. If your work goal changes, you will need to submit a new plan.

Call the Cadre if:

An emergency expense comes up; if it is related to your goal they may allow it as an expense.
You need to change what you are going to buy, what something costs, or where you will buy it.
You need to revise your milestones.
You wish to pursue a different work goal.
You cannot pursue your work goal at this time.
You no longer wish to pursue the goal or have the plan.

What if, for whatever reason, you cannot continue pursuing your goal?
Your PASS can be suspended for up to 12 months. If, after 12 months, you still cannot pursue your goal, then your PASS will be terminated. Any money left in the account when the PASS ends will be returned to SSA.

What happens to the things that were purchased when your PASS ends?
As long as you followed your plan, spent the money on approved expenses and were following your milestones, you are in compliance with your plan and anything that you purchased with PASS monies is yours to keep.

Tracking PASS Expenses and Activities
If you have assisted someone by writing a PASS plan for them, they may need some support developing an organizational system to track their expenses and PASS activities. A low-tech, low-cost option is a multi-pocket folder or multi-section envelope (see the diagram below).

Tri-pocket Folder

Front of Folder

Inside of Folder

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