Sometimes the Social Security Administration (SSA) will decide that it is in your best interest to have your benefit payments handled by someone else. This person, or organization, is called a representative payee. The administrative law judge (ALJ) that hears your Social Security disability case usually makes this decision and may discuss it with you during your hearing. But oftentimes you will not learn that your payments will be made to a representative payee until you receive your written decision.
What Is a Representative Payee?
A representative payee is a person or organization that receives your Social Security or SSI disability benefits on your behalf. A representative payee must use your payments for your support and care only. Your representative payee may use the money to pay bills, buy food and clothing, save for your future, pay for your entertainment, or in any other manner that is in your best interest and for your benefit.
Why Did the SSA Decide I Needed a Representative Payee?
The SSA decided you needed a representative payee because it believed you were unable to successfully manage your benefits. This decision is usually based on evidence presented in your case. Here are some examples.
- The claimant was awarded benefits because of severe bipolar disorder. The claimant’s psychiatric record contained evidence that her disorder frequently caused her to spend excessive amounts of money on alcohol, drugs, and gambling. The claimant also testified to this at her hearing. Based on these factors, the SSA concluded that it was in the claimant’s best interest to have her benefits managed by a representative payee.
- The claimant was awarded benefits based on mental retardation. The claimant was only minimally educated and could not perform basic math functions or read effectively. He had never had a checking account; accordingly, the SSA decided that the claimant was unable to handle his financial affairs and assigned him a representative payee.
- The claimant was awarded benefits because of early-onset Alzheimer’s. Although she could provide basic self-care, the claimant frequently suffered bouts of confusion and experienced an increase with difficulty organizing and paying her bills on time. The claimant’s judgment was also affected and she frequently misused money and failed to pay for basic needs. Because of these symptoms, the SSA determined it was in her best interest to assign the claimant a representative payee.
How Does the SSA Decide Who My Representative Payee Is?
When deciding on whom to appoint as your representative payee, the SSA will look first at whether you live with someone who helps takes care of you. If you do not, the SSA may choose a family member, friend, legal guardian, or a lawyer. The goal of the SSA is to select someone who knows you well, sees you frequently, and is familiar with your needs and wants.
If none of these options are available, the SSA may select an organization that specializes in handling Social Security benefits for people. Or, if you live in a nursing home, the facility may receive the benefits to pay for your care.
Although the SSA decides who your representative payee is, at your hearing the ALJ may discuss with you whether you have any preferences about whom you would like, or not like, to handle your benefits.
Is There Anything Special I Need to Tell My Payee?
You need to keep your representative payee apprised of any major life changes that may affect your eligibility for benefits. Here are some examples:
- starting or stopping a job
- getting married
- getting money from other sources (i.e. inheritance)
- leaving the country
- being incarcerated
- applying for welfare or other state or federal benefits, and
- no longer being disabled.
If you fail to tell your representative payee about any of these factors, you may get more money than you are eligible for. If this happens you may be required to repay these funds (called overpayments).
What Can I Do if I Disagree With the SSA’s Decision?
Once you have received written notice from the SSA that it has assigned you a representative payee, you have 60 days to appeal the decision in writing. If you don’t like the representative payee that was chosen for you, you must appeal the choice in this time frame as well. Make sure you explain in detail why you disagree with the decision.
What if I Want My Representative Payee Changed?
If you decide that you want to change the representative payee who has been handling your money, you should first tell your payee of your decision. After you have advised your current payee, the new person you have selected must go to your local SSA office and file an application.
How Can I Get Control of My Benefits Back?
To get control of your benefits back, you must prove to the SSA that you are mentally and physically capable of handling your own money. Here are some examples of how you can show this.
- Provide a letter from your treating physician or psychiatrist that states he or she believes you can take care of your finances, or
- Provide a certified copy of a court order that states the court believes you are able to take care of your own finances.
Keep in mind that if your condition has improved so much that you can now care for your personal affairs, the SSA may use this as evidence that you are no longer disabled, which could result in a loss of your disability benefits.
What Can I Do if I Think My Representative Payee is Misusing My Money?
If you think your payee is misusing your money, you must advise the SSA as soon as possible and the SSA will investigate your concern. A representative payee who misuses your funds is committing theft and can face criminal charges.
Payees must comply with detailed reporting requirements. For more information, see our article on how payees must account to Social Security.