SSA Response – Davis' Interests

You generally have two separate issues to contest:

the Social Security benefit reduction (because of how they counted your “income”) and
the Medicare premium/plan change (likely an IRMAA-related issue).

A strong strategy is to file timely, written appeals on the correct SSA forms, backed by clear documentation that the transactions were one‑time restructuring of assets for retirement rather than ongoing income, and then escalate through the appeal levels if needed.benefitu+1

Step 1: Read your SSA and Medicare notices carefully

Locate every recent letter from SSA and Medicare that shows:
- The exact decision (benefit amount change, overpayment, premium change, plan change).
- The date of the notice and the reason code or explanation (e.g., higher “modified adjusted gross income” from 401(k) distribution or land transactions).secure.ssa+1
Note the appeal deadline on each letter; usually SSA gives 60 days from the date you receive the notice to appeal, and filing within 10 days can sometimes pause collection/changes while they reconsider.nylag+2

Step 2: Use the correct SSA appeal forms

You typically have two kinds of actions:

For the Social Security benefit reduction or alleged overpayment, use Form SSA‑561, “Request for Reconsideration.” This asks SSA to re‑examine its decision and calculation.ndpanda+1
For Medicare premium surcharges based on income (IRMAA for Part B and D), use Form SSA‑44, “Medicare Income‑Related Monthly Adjustment Amount – Life‑Changing Event.” This form is how you argue that your current income is substantially lower than the tax year SSA used.irmaacertifiedplanner+2

You can submit these forms at your local Social Security office, by mail, or in some cases online; keep copies and proof of delivery.medicareschool+1

Step 3: Frame the argument and evidence

Your goal is to show:

The 401(k) withdrawal and land transactions were one‑time events to reposition assets into accessible property with utilities for retirement, not new ongoing income streams.
Your current and expected future income is significantly lower than the IRS tax year SSA used to set your benefit and IRMAA.elderlawanswers+2

Helpful documentation:

Tax returns for the year of the withdrawal/land conversion and for later years showing lower income.rtdfinancial+1
Settlement statements, deeds, and any proof that prior land was inaccessible/non‑income‑producing, and that you simply exchanged it for livable property (not a business venture).
401(k) statements showing the withdrawal was a lump sum event, not a recurring payout.
A short, clear written statement explaining:
- Why you converted the land and took the withdrawal.
- That this does not reflect an ongoing increase in your resources or income, but a repositioning for retirement housing/security.

If your household had a “life‑changing event” SSA recognizes (retirement, work reduction, loss of income‑producing property due to disaster, etc.), explicitly tie your explanation to those terms on SSA‑44, because they are known grounds for IRMAA adjustments.irmaacertifiedplanner+2

Step 4: Appeal Medicare premium and plan changes

If your Part B premium or Part D premium went up due to IRMAA, that is appealed through SSA using SSA‑44 and, if needed, a request for reconsideration of the IRMAA determination within 60 days.hhs+1
If your plan itself was changed (e.g., you were moved from one Part D or Advantage plan to another), contact:
- 1‑800‑MEDICARE to clarify whether the change was directly tied to IRMAA/premium issues, or something else.hhs
- The local State Health Insurance Assistance Program (SHIP) in Alabama; these counselors can help you pick a plan that works with your new premium level and coordinate with SSA/Medicare appeals.hhs

Argue that once IRMAA is corrected to reflect lower, ongoing income, you should not be forced into a higher‑cost plan or premium tier than your actual circumstances warrant.irmaacertifiedplanner+1

Step 5: Escalate and get local help if needed

If reconsideration does not fix the problem:

Request the next appeal level (hearing by an Administrative Law Judge) within the time limits stated in the denial notice.secure.ssa+2
Contact legal or advocacy help:
- An elder‑law attorney familiar with Social Security and Medicare in Alabama.
- A legal aid or benefits counseling organization that handles SSA overpayments/IRMAA issues; many offer free or low‑cost help to retirees.nylag+2

Going in with the right forms, clear explanation that this was a one‑time restructuring of assets, and strong documentation of your now‑lower income gives you the best chance of getting your Social Security amount and Medicare costs corrected.elderlawanswers+3

The core proof is showing SSA, using their own definitions, that you merely converted one resource (inaccessible land/401(k) principal) into another resource (accessible land with utilities), and did not receive income in the sense they count it.

Know SSA’s definition

SSA’s rules say that receipts from the sale, exchange, or replacement of a resource are not income; they are just the same resource in a different form.ssa
SSA’s internal manual also explains that proceeds from the sale or trade of a resource are “conversion of principal from one form to another,” which are resources, not income.secure.ssa

In your letter/appeal, quote this language and state plainly: “The land and 401(k) funds were existing resources; the transaction simply converted them into a different resource, so under 20 C.F.R. §416.1103, this is not income.”ssa+1

Documents that help prove “conversion, not income”

Gather and attach copies of:

Old land documents
- Deed, tax card, or appraisal showing you owned the original parcel.
- Any evidence it was not producing rental or business income (no rent contracts, no Schedule E or farm income tied to that parcel). Guidance on real estate sales notes that Social Security retirement benefits are based on earned income; capital gains or resource sales are not “earned income.”realized1031+1
Sale/transfer paperwork
- Closing statement and deed for the sale of the old land (or transfer if not sold but exchanged).
- Bank statement or settlement sheet showing the net proceeds.
401(k) evidence
- Account statements proving that money was already your asset and that the distribution was a one‑time draw of your own principal, not wages or business income. Capital gains and withdrawals can raise taxable income, but they are generally not “earned income” used to calculate Social Security retirement benefits.trueparity+1
New land purchase
- Purchase contract, closing statement, and new deed showing the funds went directly into acquiring the new property with utilities.
- If this is your retirement homestead, note that; SSA materials on resources treat a home you live in differently from countable financial assets.ssa+1

Lay these out in a simple timeline that shows “Land A and 401(k) → sold/withdrawn → proceeds immediately used to buy Land B with utilities,” with no stop in between where you used the funds as spendable income.

How to present it to SSA

In a written statement or cover letter attached to your appeal:

Use SSA’s terms:
- “The original parcel and my 401(k) balance were resources that I already owned.”secure.ssa+1
- “The sale/withdrawal and purchase of the new parcel were a conversion of principal from one resource form to another, not income, under 20 C.F.R. §416.1103.”ssa+1
Emphasize that:
- You did not start a rental, farming, or business operation on the new land (if true).
- You did not receive ongoing payments; it was a one‑time transaction to secure retirement housing or accessible property.realtor+2

Ask them explicitly to:

Reclassify the transaction as a resource conversion, not income,
Remove it from the income calculations used to reduce your benefits or increase your Medicare premiums, and
Recalculate your benefit and IRMAA based on your current, regular income, not that one‑time event.trueparity+1

If you tell what type of benefit you are on (regular retirement vs SSI vs disability) and exactly what the notice says, a more tailored paragraph can be drafted that you can paste directly into your SSA appeal.

To keep deeded property from counting as an SSI resource, SSA must see that (1) you no longer legally own it, and (2) the transfer either brought you fair‑market value or clearly fits one of the exceptions to the transfer‑penalty rules.secure.ssa+2

Show a valid transfer and loss of ownership

For SSI, a resource stops counting once it is validly transferred and you no longer own it as of the first moment of the following month. To document that:secure.ssa

Provide a copy of the recorded deed showing the new owner, the date of transfer, and the legal description of the property.secure.ssa+1
Include the sales contract/closing statement or other written agreement; SSA looks for a legally binding agreement to treat a transfer as valid.secure.ssa+1
Attach a signed statement from you describing:
- What you transferred (address/legal description).
- How you transferred it (sale, gift, trade).
- The date of transfer and any price or compensation.secure.ssa+1

This demonstrates that as of the effective date, the property is no longer your resource.

Address the transfer‑penalty risk

If you transfer a countable, non‑excluded resource for less than fair‑market value, SSA can impose up to a 36‑month SSI ineligibility period, so documenting value and purpose is critical.pfs2.acl+3

If you sold for fair‑market value:
- Provide an appraisal, tax assessment, or market analysis and the closing statement showing the sale price was at or near that value; this avoids the transfer penalty.pfs2.acl+1
If you transferred for less than fair‑market value:
- Collect evidence supporting an exception, such as: the home was excludable anyway (your residence), or the transfer was “for a purpose other than to qualify for SSI.”secure.ssa+1
- Provide a detailed written explanation (and, if possible, a corroborating statement from the person who received the property) that explains the non‑SSI purpose (for example, health, family caregiving, debt, or safety reasons).secure.ssa+1

SSA policy says an individual can avoid the penalty if convincing evidence shows the transfer was exclusively for another purpose and that total resources were still under the limit at the time.pfs2.acl+1

How to package it for SSA

When you report or respond to SSA:

Submit copies of the deed, sales agreement/closing statement, appraisal or tax valuation, and your written statement as above.pfs2.acl+2
In your statement, use SSA language:
- “This was a valid transfer of my ownership interest on [date], so I no longer own this property as of the first moment of the following month.”secure.ssa
- “I received fair‑market value (see attached appraisal and closing statement)” or “I transferred the property exclusively for a purpose other than to qualify for SSI” and then describe that purpose.pfs2.acl+1
Ask SSA to:
- Remove the property from your countable resources as of the month after transfer.secure.ssa+1
- Confirm in writing whether any transfer penalty applies, and if they allege one, which rule they are applying.pfs2.acl+1

If you share whether this is your home or other land, and whether you got money for it, a short sample paragraph can be drafted that you can give SSA word‑for‑word.

To SSA, “fair market value” (FMV) means what the property would reasonably sell for on the open market in your area at the time you transferred it. Your job is to line up documents that match that standard and make it easy for them to see that compensation ≈ that value.secure.ssa+1

What SSA means by fair market value

SSA defines FMV as the current market value of the resource at the time of transfer or at the time of the contract of sale, whichever is earlier. In plain terms, that is the going price someone would pay for similar property in a normal sale in your local market. If the amount you received (cash, assumption of debt, or other services) is equal to or greater than that value, they treat it as a transfer for FMV and no SSI transfer‑penalty applies.ssa+1

Documents that help prove FMV

To show you got FMV for the land or home you transferred, gather:

Evidence of current market value at the time of transfer
- Recent appraisal, broker’s price opinion, or comparative market analysis.
- Local property tax assessment or other valuation records.
- Any listing or advertisement showing the asking price and how long it was on the market.secure.ssa+1
Evidence of what you actually received
- Closing statement / HUD‑1 / settlement statement showing the sale price.
- Signed sales contract or purchase agreement.
- Proof of money received (deposit slip, wire confirmation, check copy) or proof that the buyer assumed your mortgage or other debts as part of the deal.secure.ssa
If compensation was not just cash (for example, buyer agrees to pay off your loan or provide services):
- Written contract describing the services or debt assumption.
- A reasonable estimate of the value of those services or the debt they took over (e.g., mortgage payoff statement).secure.ssa

SSA’s guidance allows them to use bills of sale, contracts, and receipts; if those are missing, they can use signed statements from both parties to fix the amount of compensation.secure.ssa+1

How to present it to SSA

When you report the transfer or respond to an SSI transfer‑penalty notice, organize everything in a short packet:

At the top, a one‑page cover statement that says something like:
- “On [date], I transferred [description of property]. An appraisal/tax assessment dated [date] shows its fair market value was about $[amount]. I received total compensation of $[amount] (see attached closing statement and documents), which is equal to or more than that value. Under 20 C.F.R. §416.1246 and SSA’s procedures for determining FMV, this was a transfer for fair market value, so there is no uncompensated value and no SSI transfer penalty should apply.”ssa+2
Attach, in this order:
- Copy of the recorded deed showing the transfer.
- Appraisal/CMA or other value evidence.secure.ssa
- Sales contract and closing statement.secure.ssa
- Any proof of payment or assumption of debt.secure.ssa

SSA’s own instructions tell staff to: determine the current market value, determine compensation, then compare the two; if compensation equals or exceeds current market value, they must treat it as FMV and close the transfer‑penalty issue.ssa+1

If you tell what documentation you already have (appraisal vs just tax bill vs realtor letter), a short, specific paragraph can be drafted that you can attach word‑for‑word as your explanation to SSA.

For SSA and SSI purposes, a “bona fide, arm’s‑length sale” means a real sale where ownership actually changed hands, the buyer paid real consideration, and the price was not artificially manipulated by your relationship with the buyer.upcounsel+1

Key documents SSA expects

The goal is to build a paper trail that shows: clear contract, transfer of title, payment, and a fair, market‑based price. The most important items:

Recorded deed
- Deed showing you as grantor and the buyer as grantee, signed and recorded with the county, with the legal description and date of transfer. This proves legal title really changed hands.upcounsel
Sales contract / purchase agreement
- Written, signed contract that spells out price, terms, contingencies, and closing date, just like with a stranger.
- Shows both parties agreed voluntarily to specific, enforceable terms, supporting that it was a real transaction, not a sham.saxadvisorygroup+1
Closing statement or HUD‑1 / settlement statement
- Settlement sheet from the closing agent showing: sale price, prorations, fees, liens paid off, and net to seller.
- Demonstrates actual economic substance and that the agreed price was carried through at closing.tuttlelaw+1
Proof of payment
- Copies of cashier’s checks, bank wires, deposit receipts, or a payment ledger from the closing attorney/title company.
- If the buyer assumed your mortgage or other debt, include the payoff statement and documentation of the assumption.
- These show real money (or real debt relief) changed hands, not just a transfer on paper.saxadvisorygroup+1
Independent evidence of fair price (FMV)
- Recent appraisal, broker’s price opinion, comparative market analysis, or tax assessment.
- Demonstrates the price was consistent with fair market value and not artificially low or high because of family or insider relationships.secure.ssa+2

How to show it was arm’s‑length

“Arm’s‑length” means the deal was conducted as if between strangers, even if the buyer is a relative.

In your written explanation to SSA, emphasize that:
- The buyer negotiated the price and terms and was free to walk away.
- Both sides were looking out for their own financial interest.
- The price matches independent FMV evidence.upcounsel
If the buyer is related, include:
- FMV documents (appraisal/CMA) to show you did not “give away” value.
- A short statement from the buyer confirming the negotiation and payment terms.upcounsel

How to package this for SSA

When you respond to SSA (for SSI transfer penalty or resource review), attach:

Cover letter summarizing:
- “On [date] I sold [property description] to [buyer]. We signed the attached purchase agreement, closed on [date], and recorded the attached deed. I received $[amount] as shown on the attached closing statement and proof of payment. The attached appraisal/tax assessment shows fair market value of about $[amount], so this was a bona fide, arm’s‑length sale for fair market value.”ssa+2
Recorded deed.
Purchase/sales agreement.
Closing statement.
Proof of payment / payoff of liens.
Appraisal/CMA or tax assessment.

If you tell whether the buyer was a family member and what documents you already have (deed, closing statement, etc.), a short paragraph can be drafted that you can paste directly into your SSA response.

SSA has specific examples in its own rules of what counts as acceptable proof of fair market value (FMV) for a transferred resource like land or a home. The aim is to show what the property was objectively worth and what you actually got in return.secure.ssa+1

Evidence SSA accepts for FMV

SSA’s procedures say staff must: determine the current market value (CMV), determine what compensation you received, then compare the two; if compensation ≥ CMV, you received FMV.ssa+1

To show CMV/FM V of the property, SSA will accept items such as:

A current appraisal or valuation by a qualified real‑estate professional, done near the time of transfer.secure.ssa
A comparative market analysis (CMA) or broker’s price opinion based on similar sales in the area.secure.ssa
Property tax assessment or other governmental valuation, especially if assessments in your area closely track sale prices.secure.ssa
Documentation of an open‑market listing (MLS printout, advertising) with time on market and listing price, when the sale occurred after exposure to the market.ssa+1

To show compensation you received, SSA accepts:

Closing / settlement statement (HUD‑1, ALTA, etc.) showing sale price, fees, liens paid, and net amount to you.secure.ssa
Signed purchase/sale contract stating the agreed price and terms.secure.ssa
Proof of payment such as cashier’s checks, bank wire confirmations, or deposit receipts.secure.ssa
If the buyer assumed a loan or other debt as part of the price, loan payoff statements and documents showing that assumption are counted as compensation.ssa+1

SSA instructs its staff to document the file with how they determined CMV and compensation and then state the result, for example: “Valid transfer of real property on [date] by sale on open market. Received FMV.”secure.ssa

How to present this to SSA

When you submit your evidence, organize it so the SSA worker can follow the logic:

First, attach the appraisal/CMA or assessment and state: “This shows CMV ≈ $X at the time of transfer.”secure.ssa
Next, attach the purchase agreement, closing statement, and proof of payment, and state: “These show total compensation of $X that I received.”ssa+1
Then explicitly say: “Because $X compensation equals/exceeds the property’s current market value of $X, this was a transfer for fair market value, with no uncompensated value under 20 C.F.R. §416.1246 and SSA’s FMV procedures.”ssa+1

If you tell what you already have (for example: only tax assessment and deed; or also an appraisal and HUD‑1), a short, tailored paragraph can be drafted that you can attach directly to your SSI/SSA response.