RECOVERY OF OASDI OVERPAYMENTS BY MEANS OF REDUCTION IN TAX REFUNDS.

SEC. 5129. RECOVERY OF OASDI OVERPAYMENTS BY MEANS OF REDUCTION IN TAX REFUNDS. (a) Additional Method of Recovery.—Section 204(a)(l)(A) (42 U.S.C. 404(a)(1)(A)) is amended by inserting after “payments to such overpaid person,” the following: “or shall obtain recovery by means of reduction in tax refunds based on notice to the Secretary of the Treasury as permitted under section 3720A of title 31, United States Code,”. (b) Recovery by Means of Reduction in Tax Refunds.—Section 3720A of title 31, United States Code (relating to collection of debts owed to Federal agencies) is amended— (1) in subsection (a), by striking “OASDI overpayment and”; (2) by redesignating subsection (f) as subsection (g); and (3) by inserting the following new subsection after subsection (e): “(f)(1) Subsection (a) shall apply with respect to an OASDI over-payment made to any individual only if such individual is not currently entitled to monthly insurance benefits under title II of the Social Security Act. “(2)(A) The requirements of subsection (b) shall not be treated as met in the case of the recovery of an OASDI overpayment from any individual under this section unless the notification under subsection (b)(D describes the conditions under which the Secretary of Health and Human Services is required to waive recovery of an overpayment, as provided under section 204(b) of the Social Security Act. “(B) In any case in which an individual files for a waiver under section 204(b) of the Social Security Act within the 60-day period referred to in subsection (b)(2), the Secretary of Health and Human Services shall not certify to the Secretary of the Treasury that the debt is valid under subsection (b)(4) before rendering a decision on the waiver request under such section 204(b). In lieu of payment, pursuant to subsection (c), to the Secretary of Health and Human Services of the amount of any reduction under this subsection based 104 STAT. 1388–288on an OASDI overpayment, the Secretary of the Treasury shall deposit such amount in the Federal Old-Age and Survivors Insurance Trust Fund or the Federal Disability Insurance Trust Fund, whichever is certified to the Secretary of the Treasury as appropriate by the Secretary of Health and Human Services.”. (c) Internal Revenue Code Provisions.— (1) In general.—Subsection (d) of section 6402 of the Internal Revenue Code of 1986 (relating to collection of debts owed to Federal agencies) is amended— (A) in paragraph (1), by striking “any OASDI overpayment and”; and (B) by striking paragraph (3) and inserting the following new paragraph: “(3) Treatment of oasdi overpayments.— “(A) Requirements.—Paragraph (1) shall apply with respect to an OASDI overpayment only if the requirements of paragraphs (1) and (2) of section 3720A(f) of title 31, United States Code, are met with respect to such overpayment. “(B) Notice; protection of other persons filing joint return.— “(i) Notice.—In the case of a debt consisting of an OASDI overpayment, if the Secretary determines upon receipt of the notice referred to in paragraph (1) that the refund from which the reduction described in paragraph (1)(A) would be made is based upon a joint return, the Secretary shall— “(I) notify each taxpayer filing such joint return that the reduction is being made from a refund based upon such return, and “(II) include in such notification a description of the procedures to be followed, in the case of a joint return, to protect the share of the refund which may be payable to another person. “(ii) Adjustments based on protections given to other taxpayers on joint return.—If the other person filing a joint return with the person owing the OASDI overpayment takes appropriate action to secure his or her proper share of the refund subject to reduction under this subsection, the Secretary shall pay such share to such other person. The Secretary shall deduct the amount of such payment from amounts which are derived from subsequent reductions in refunds under this subsection and are payable to a trust fund referred to in subparagraph (C). “(C) Deposit of amount of reduction into appropriate trust fund.—In lieu of payment, pursuant to paragraph (1)(B), of the amount of any reduction under this subsection to the Secretary of Health and Human Services, the Secretary shall deposit such amount in the Federal Old-Age and Survivors Insurance Trust Fund or the Federal Disability Insurance Trust Fund, whichever is certified to the Secretary as appropriate by the Secretary of Health and Human Services. “(D) OASDI overpayment.—For purposes of this paragraph, the term ‘OASDI overpayment’ means any overpayment of benefits made to an individual under title II of the Social Security Act.”. 104 STAT. 1388–289 (2) Preservation of remedies.—Subsection (e) of section 6402 of such Code (relating to review of reductions) is amended in the last sentence by inserting before the period the following: “or any such action against the Secretary of Health and Human Services which is otherwise available with respect to recoveries of overpayments of benefits under section 204 of the Social Security Act”, (d) Effective Date.—The amendments made by this section— (1) shall take effect January 1, 1991, and (2) shall not apply to refunds to which the amendments made by section 2653 of the Deficit Reduction Act of 1984 (98 Stat. 1153) do not apply.