What are my responsibilities as a representative payee for a child?

I recently won a child’s SSI case for a young girl. It was difficult to win but now what is turning out to be more difficult for the family is having to make a choice as to who should be the representative payee.   In all children’s cases, the Social Security Administration appoints a “representative payee” to manage the funds for the child. A representative payee is a person appointed by the Social Security Administration who is paid the benefits to use on a beneficiary’s behalf. Usually the representative payee is a legal guardian, relative, friend or sometimes an organization. The job entails a great deal of responsibility.  The payee must be responsible, must know how to manage money, and keep it apart from their own money.

Representative payees must use the money for the beneficiary’s food, shelter, clothing, medical care, and personal comfort items. If there is any money left, it should be saved in an interest bearing account – if there is such a thing these days, or in savings bonds.

In my case, as is true with many cases, the child received a large past due amount. In this situation, the representative payee must establish a “dedicated account” in a bank.  The account may be a savings, checking or money market account.  The account may only be used for:

  • Medical treatment and education or job skills training;
  • Personal needs assistance related to the child’s disability – special equipment, housing modification and therapy or rehabilitation; or
  • Any item or service that related to the child’s disability that the Social Security Administration “SSA”) deems would be appropriate.

A representative payee is required to obtain approval from the SSA before incurring the expense. The payee must keep a record of all money taken from this account and retain receipts for all items or services bought because Social Security will review these records once a year.

Being a representative payee is not easy and requires good record-keeping.  If the SSA determines that the payee misused the funds in the dedicated account, the SSA may require the payee to pay it back out of his or her money.

The SSA has published an informative guide for representative payees It is worthwhile to read this guide before deciding whether or not to take on the responsibility of being a payee.

Representative payees may no longer be required to appear at face-to-face interviews as part of Social Security’s investigation if they are previously known to the SSA

The Social Security Administration has recently amended its regulations regarding the investigation of representative payees.  Representative payees are persons appointed by a recipient of Social Security benefits (or appointed on their behalf) when the Social Security Administration (“SSA”)  determines that it would be in the best interest of a recipient for a payee to receive the direct payment.

It was previously the law that Social Security had to conduct face-to-face interviews with potential payees as part of the investigatory process even if the payees had previously filed to become payees.    Their new rule, effective December 10, 2008, no longer requires the SSA to conduct a face-to-face interview with an individual or organization if the SSA has already conducted a face-to-face interview with that payee  and the payee is qualified and is currently acting as a payee.  However, the SSA still has the discretion to require an in-person meeting if they deem it necessary.

According to the SSA, this new change will streamline the payee application process, expedite payment of benefits, and reduce the burden in SSA field offices.  You may find a copy of the regulation in the Federal Register here.