SSA Discontinues Letter-Forwarding Service
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SSA Discontinues Letter-Forwarding Service

By Allen Smith  4/28/2014
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Following in the footsteps of the Internal Revenue Service (IRS), the Social Security Administration (SSA) announced in an April 17, 2014, Federal Register notice that it no longer will forward letters from plan sponsors, among others, to missing plan participants or beneficiaries.

The SSA had provided the service to the public since 1945. The inquirer could be an individual, private organization or government agency.

The SSA would provide the service for free if the inquirer provided a compelling reason to show that the missing person would want to be aware of the contents of the letter. Also, it was available when an immediate family member was seeking to re-establish contact with another immediate family member.

For $35, the SSA provided the service if the missing person was due something of value and it was reasonable to assume that he or she was not aware that the asset is due.

“In recent years, the Internet offers a rapid expansion of locator resources via free social media websites and for-pay locator services. The public now has widespread access to the Internet and the ability to locate individuals without relying on our letter-forwarding services,” the SSA stated, noting that discontinuing the service is a cost-saving measure.

IRS Discontinuance

This is in line with the IRS’s discontinuance of its letter-forwarding service as of Aug. 31, 2012.

On Dec. 6, 2013, the IRS noted that, “plan sponsors, administrators and qualified termination administrators sometimes need to locate missing participants or beneficiaries.”

For example, correction of a plan failure may require payment of additional benefits to terminated participants.

But in Revenue Procedure 2012-35, the IRS announced that it “will no longer consider locating a missing taxpayer who may be entitled to a retirement plan payment or other financial benefit from an individual, company or organization to be a humane purpose for which the service will provide letter-forwarding services.”

The IRS has explained that in the absence of letter-forwarding services, plan sponsors may use such methods to locate missing participants and beneficiaries as:

  • Commercial locator services.
  • Credit reporting agencies.
  • Internet search tools.

Allen Smith, J.D., is the manager of workplace law content for SHRM. Follow him @SHRMlegaleditor.

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