If your adult child is getting ready to apply for SSI, they may need a representative payee. A representative payee is a person who manages SSI payments on behalf of a beneficiary. This means they can receive cash benefits and have the authority to use the money on the beneficiary’s behalf. Unless SSA has specifically permitted it or you are a legal guardian appointed by the court, you may not collect a fee for services provided to the beneficiary.
Let’s break down what this means
A representative payee is a Social Security Administration (SSA) term that defines a person’s role in assisting a beneficiary with their money. If SSA determines a beneficiary needs help, they appoint a representative payee. Becoming a representative payee gives you the authority to negotiate and manage SSI payments for someone else. SSA appoints this position, as it is separate from power of attorney or having a joint bank account with the beneficiary. In addition, a payee has no authority over non-SSI benefits or medical decisions.
Responsibilities
A representative payee must use the SSI funds to pay for the beneficiary’s needs. Once expenses are paid, the representative payee can use the money for the beneficiary’s entertainment or save it for future needs, while remembering that SSI recipients must stay under the $2000 asset threshold. They also must inform SSA if there is a change to the beneficiary’s situation that could affect SSI payments.
Each year, the representative payee must complete the Representative Payee Report. Natural or adoptive parents of a disabled adult beneficiary who primarily lives in the same house as the beneficiary are not required to fill out a report. In addition, a protection and advocacy agency in their state may contact a representative payee to review expenses.
Who can be a payee
SSA looks for a family member or legal guardian to serve as the payee. It should be someone who has regular contact with the beneficiary and knows what they need. Some beneficiaries use a friend or a lawyer to fill this role. If the beneficiary knows who they want to be their payee, they should tell SSA. Ultimately, SSA determines who it will be.
Setting up an account
You will need to have a bank account with the beneficiary’s name as the primary account holder and your name as the payee. Their name must be the primary name on the account. Your account needs to accept electronic payments and should have FDIC insurance. Do not use a joint account and do not mix funds.
For more information go to ssa.gov.
