There are correction factors for confining stress and also for the efficency of the hammer. I am not aware of any correction factor that is dependent on the position of the water table other than the fact that the water table is a factor in determining confining stress.
Generally N values should be corrected for overburden pressure. One correction factor is: .77log(20/p)
Log is base 10, p is effective overburden pressure at sample depth.
The other is for p< 1.5ksf, 4/(1+2p)
for p >= 1.5ksf 4/(3.25+.5p)
Both methods yield similar results. The first is probably the most widely accepted.
Computation of overburden would include groundwater effects.
If you are trying to assess liquefaction potential, there is an extensive set of adjustments to account for the effects of confining stress, fines content, hammer type/hammer energy, rod lengths, non-use of a liner in a sampler with space for one, etc.
If you are trying to estimate RD using a correlation like the one in DM7 (which I think came from Holtz at USBR, although they didn't attribute it), then you don't adjust for overburden since the overburden is part of the correlation. (In fact, that's where the adjustment for liquefaction came from in the first place.) Likewise, if you are using it to estimate undrained shear strength using the correlation by Terzaghi and Peck, Sowers, or one of the others out there, don't adjust for overburden, because the developers did not adjust.
As a general rule, use a correlation the way it was developed. If the original was based on unadjusted blowcounts, then don't adjust.
Consider also what test the correlation is referenced to. The T&P line came from unconfined compression tests which provide only a rough estimate of undrained shear strength (by doubling the result), due to sample disturbance, drying, etc. I think the one by Sowers came from unconfined tests also. There are a couple others that were referenced to field VST - better, IMO, if one is after undrained shear strength.
Literally and figuratively, the SPT is a blunt instrument.
Many of the footing settlement correlations in silty sand using the SPT use a blow count correction for silty sand below groundwater for N60 blow counts > 15. The corrected N60* blow count is: N60*=15+.5*(N60-15). Thsi correction is applied only to N60 values > 15 for silty sand below groundwater. Thsi is applicible to Meyerhoff, Terzaghi/Peck, and Burland/Berbidge correlations.
