Do you have a friend or loved one who receives Social Security and is unable to manage payments?

 

If so, you can request that the Social Security Administration (SSA), the government agency that disburses Social Security, name you as the representative payee for that person.

Being a representative payee gives you the power and the responsibility to manage that money for your friend or loved one.

 

(The Office of Personnel Management and the Railroad Retirement Agency also appoint representative payees, and the responsibilities are basically the same.)

As a representative payee, you only have the power to handle the Social Security benefit for your friend or loved one. You may not handle any other money or property for that person unless some other document or government agency appoints you to do so. 

It is important to remember that the check from the SSA is not yours; it belongs to the beneficiary. The beneficiary is supposed to get the benefit of the money.

Your role includes performing four very important duties:
  1. You must act only in the beneficiary’s best interest, which means the beneficiary’s money belongs only to them. 
     
  2. You must manage the beneficiary’s Social Security check carefully, which means you should make sure the beneficiary’s daily needs and any other foreseeable needs are met, bills are paid on time, and all taxes are paid.
     
  3. You must keep the money from the Social Security check separate from your own money. This means you cannot keep the money in any kind of joint account or sign any contracts or leases for the beneficiary. 
     
  4. You must keep good records of everything you do with the beneficiary’s money. This means keeping track of all money you spend for the beneficiary and keeping all receipts. Representative payees also have to file annual reports unless they are exempt.
The following types of payees are now exempt from the annual accounting requirements: 

 

  • Natural or adoptive parents or legal guardians of a minor child beneficiary who primarily reside in the same household as the child
  • Natural or adoptive parents of a disabled adult beneficiary who primarily reside in the same household with the beneficiary
  • Spouse of a beneficiary

Remember, there may be other people appointed to help the same beneficiary with other things.

 

They have the same general four duties as you, and all of you must work together if that is in the beneficiary’s best interest.

If you are not a family member and the beneficiary has family, you must keep family members informed about what you are doing for the beneficiary. This will reduce the chance that they will have problems with your actions.

In the end, however, the decisions about the Social Security check are yours to make because you are responsible. You are the one who will get in trouble if something goes wrong. For example, if someone thinks you violated one of your four important duties, they can report you to the SSA. The SSA will investigate, and if it decides that you misused the beneficiary’s money, it will make you replace what was lost out of your own pocket.

The SSA has created a Representative Payee Portal as a central gateway for individual representative payees with a my Social Security account to conduct their own business or manage direct deposit, wage reporting, and annual reporting for their beneficiaries.

If you have more questions about what it means to be a representative payee, check out www.ssa.gov/payee.

For more information, visit the SSA’s online guide for representative payees

 

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Orange County Estate Planning Attorney Kevin SnyderKevin Snyder is a husband, father, and an Orange County estate planning attorney and elder law attorney at Snyder Law, PC in Irvine, California. He's all about family and passionate about estate planning, elder law, and veterans. He founded Snyder Law to help people be prepared and have the peace of mind they are protecting their families and aging parents for when life happens.

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