---
kind: "section"
citation: "20 C.F.R. § 404.402"
title: "20"
number: "404.402"
heading: "Interrelationship of deductions, reductions, adjustments, and nonpayment of benefits."
url: "https://uscodex.org/cfr/20/404.402"
---

# §404.402. Interrelationship of deductions, reductions, adjustments, and nonpayment of benefits.

- (a) **Deductions, reductions, adjustment.** Deductions because of earnings or work (see §§ [404.415](/cfr/20/404.415.md) and [404.417](/cfr/20/404.417.md)); failure to have a child “in his or her care” (see [§ 404.421](/cfr/20/404.421.md)); as a penalty for failure to timely report noncovered work outside the United States, failure to report that he or she no longer has a child “in his or her care,” or failure to timely report earnings (see §§ [404.451](/cfr/20/404.451.md) and [404.453](/cfr/20/404.453.md)); or because of unpaid maritime taxes (see [§ 404.457](/cfr/20/404.457.md)) are made: * * *
  - (1) Before making any reductions because of the maximum (see [§ 404.403](/cfr/20/404.403.md)),
  - (2) Before applying the benefit rounding provisions (see [§ 404.304(f)](/cfr/20/404.304.md?p=f)), and,
  - (3) Except for deductions imposed as a penalty (see §§ [404.451](/cfr/20/404.451.md) and [404.453](/cfr/20/404.453.md)), before making any adjustment necessary because an error has been made in the payment of benefits (see [subpart F](/cfr/20/subpartF.md)). However, for purposes of charging excess earnings for taxable years beginning after December 1960 or ending after June 1961, see [paragraph (b)](#b) of this section and [§ 404.437](/cfr/20/404.437.md) for reductions that apply before such charging.
- (b) **Reductions, nonpayments.**
  - (1) Reduction because of the maximum (see [§ 404.403](/cfr/20/404.403.md)) is made:
    - (i) Before reduction because of simultaneous entitlement to old-age or disability insurance benefits and to other benefits (see [§ 404.407](/cfr/20/404.407.md));
    - (ii) Before reduction in benefits for age (see [§§ 404.410 through 404.413](/cfr/20/404.410..404.413.md));
    - (iii) Before adjustment necessary because an error has been made in the payment of benefits (see [subpart F](/cfr/20/subpartF.md) of this part);
    - (iv) Before reduction because of entitlement to certain public disability benefits provided under Federal, State, or local laws or plans (see [§ 404.408](/cfr/20/404.408.md));
    - (v) Before nonpayment of an individual's benefits because he is an alien living outside the United States for 6 months (see [§ 404.460](/cfr/20/404.460.md)), or because of deportation (see [§ 404.464](/cfr/20/404.464.md));
    - (vi) Before the redetermination of the amount of benefit payable to an individual who has been convicted of certain offenses (see [§ 404.465](/cfr/20/404.465.md)); and
    - (vii) Before suspension of benefits due to earnings (see [§ 404.456](/cfr/20/404.456.md)), for benefits payable or paid for months after December 1995 to a non-working auxiliary or survivor who resides in a different household than the working auxiliary or survivor whose benefits are suspended.
  - (2) Reduction of benefits because of entitlement to certain public disability benefits (see [§ 404.408](/cfr/20/404.408.md)) is made before deduction under section 203 of the Act relating to work (see §§ [404.415](/cfr/20/404.415.md), [404.417](/cfr/20/404.417.md), [404.451](/cfr/20/404.451.md), and [404.453](/cfr/20/404.453.md)) and failure to have care of a child (see §§ [404.421](/cfr/20/404.421.md) and [404.451](/cfr/20/404.451.md)).
  - (3) Reduction of the benefit of a spouse who is receiving a Government pension (see [§ 404.408(a)](/cfr/20/404.408.md?p=a)) is made after the withholding of payments as listed in [paragraph (d)(1)](#d-1) of this section and after reduction because of receipt of certain public disability benefits ([paragraph (b)(2)](#b-2) of this section).
- (c) **Alien outside the United States; deportation nonpayment—deduction.** If an individual is subject to nonpayment of a benefit for a month under [§ 404.460](/cfr/20/404.460.md) or [§ 404.464](/cfr/20/404.464.md), no deduction is made from his benefit for that month under [§ 404.415](/cfr/20/404.415.md), [§ 404.417](/cfr/20/404.417.md), or [§ 404.421](/cfr/20/404.421.md), and no deduction is made because of that individual's work from the benefit of any person entitled or deemed entitled to benefits under [§ 404.420](/cfr/20/404.420.md), on his earnings record, for that month.
- (d) **Order of priority—deductions and other withholding provisions.** Deductions and other withholding provisions are applied in accordance with the following order of priority:
  - (1) Current nonpayments under §§ [404.460](/cfr/20/404.460.md), [404.464](/cfr/20/404.464.md), [404.465](/cfr/20/404.465.md), [404.467](/cfr/20/404.467.md), and [404.469](/cfr/20/404.469.md);
  - (2) Current reductions under [§ 404.408](/cfr/20/404.408.md);
  - (3) Current reductions under [§ 404.408a](/cfr/20/404.408a.md);
  - (4) Current deductions under §§ [404.417](/cfr/20/404.417.md) and [404.421](/cfr/20/404.421.md);
  - (5) Current withholding of benefits under [§ 404.456](/cfr/20/404.456.md);
  - (6) Unpaid maritime tax deductions ([§ 404.457](/cfr/20/404.457.md));
  - (7) Withholdings to recover overpayments (see [subpart F](/cfr/20/subpartF.md) of this part);
  - (8) Penalty deductions under §§ [404.451](/cfr/20/404.451.md) and [404.453](/cfr/20/404.453.md).

## Notes

### Amendments

[40 FR 30813, July 23, 1975, as amended at 44 FR 29047, May 18, 1979; 48 FR 37016, Aug. 16, 1983; 48 FR 46148, Oct. 11, 1983; 56 FR 41789, Aug. 23, 1991; 60 FR 8146, Feb. 10, 1995; 68 FR 15659, Apr. 1, 2003; 68 FR 40122, July 7, 2003; 91 FR 16829, Apr. 3, 2026]

### Authority

Authority: Secs. 202, 203, 204(a) and (e), 205(a) and (c), 216(l), 222(c), 223(e), 224, 225, 702(a)(5), and 1129A of the Social Security Act (42 U.S.C. 402, 403, 404(a) and (e), 405(a) and (c), 416(l), 422(c), 423(e), 424a, 425, 902(a)(5), and 1320a-8a); 48 U.S.C. 1801.

### Source

Source: 32 FR 19159, Dec. 20, 1967, unless otherwise noted.

### Amendments

[40 FR 30813, July 23, 1975, as amended at 44 FR 29047, May 18, 1979; 48 FR 37016, Aug. 16, 1983; 48 FR 46148, Oct. 11, 1983; 56 FR 41789, Aug. 23, 1991; 60 FR 8146, Feb. 10, 1995; 68 FR 15659, Apr. 1, 2003; 68 FR 40122, July 7, 2003; 91 FR 16829, Apr. 3, 2026]