February 16, 2019
Representative payees serve a vital function for individuals who are unable to manage their own disability benefits. Here, the disability advocates at Disability Associates discuss the role and function of a representative payee for those receiving disability benefits.
What is a Representative Payee?
A representative payee is either an individual or organization who receives Social Security or SSI benefits on behalf of an individual who is unable to directly manage their own benefits. The payee is then responsible for either using the benefits to cover the expenses of the beneficiary or saving the benefits. Payees must work for the best interest of the beneficiary when considering whether to spend or save benefits. Appropriate expenses include food, clothing, shelter, utilities, dental care, medical treatment and personal comfort items. Payees are asked annually by the Social Security Administration (SSA) to provide reports and records detailing how the benefits were used or saved.
The majority of minor children, as well as legally incompetent adults, are required to have a representative payee. If the SSA believes an individual may require a representative payee, they will gather the appropriate evidence and make a decision about whether a payee should be found.
In order to apply to serve as a representative payee, prospective payees must apply through their nearest SSA office. They must also request and complete the SSA-11 form, “Request to be Selected as Payee.” The payee form is typically completed in person at the SSA office, and the SSA will also require the prospect’s Social Security number or the Employer Identification Number of the organization the prospect represents.
Are Representative Payees Paid for Their Services?
Individuals cannot receive payment for acting as a payee, although they can reimburse themselves from a beneficiary’s benefits if they incur an out-of-pocket expense on behalf of their beneficiary. These expenses will need to be documented and do not include overhead costs such as utilities, rent, office equipment or supplies.
Unlike individuals, some organizations may be allowed to collect a fee for acting as a payee. The organization must apply to receive fees and be approved by the SSA. To learn more about the requirements an organization must meet in order to collect fees, click here.
When Will a Representative Payee Need to Create a Dedicated Account?
Sometimes, minor children will receive large, past-due payments from the SSA which must be deposited directly into a separate account with a financial institution. Known as dedicated accounts, these accounts are required by law and the funds within them are not counted as SSI resources. The SSA will inform you if a payment is required to go into a dedicated account. The money placed into the account must be used for medical treatment, education or job skills training, personal needs assistance, special equipment, housing modification, therapy, rehabilitation or any other item or service related to the child’s disability, if applicable. Funds in a dedicated account that are used for a different purpose must be repaid to the SSA.
Learn More About the Responsibilities and Functions of a Representative Payee Through Disability Associates
A representative payee is an invaluable resource for minor children and legally incompetent adults who are eligible for disability benefits. The disability attorneys at Disability Associates want to help beneficiaries and prospective payees to be informed about representative payees and the application process. Contact Disability Associates today to learn more.