Social Security disability benefits are designed to provide income for you when you have a disability that keeps you from working. But sometimes you may need help managing your money (for instance, if you suffer from addiction or certain mental or cognitive impairments).
If you need help managing your benefits, the Social Security Administration (SSA) can appoint a "representative payee" or "rep payee" to handle your monthly benefit payments. If you win your Social Security disability benefits on appeal, the administrative law judge (ALJ) in your case could also make this recommendation in the Notice of Decision you receive after your appeal hearing.
If the SSA or ALJ appoints a representative payee for you, your Social Security disability insurance (SSDI) and/or Supplemental Security Income (SSI) benefits won't be sent directly to you but will instead be sent to the rep payee. Your representative payee will cash your check but must then use your benefit money on your behalf.
Here's how a representative payee could spend your benefit money:
The payee must keep records of how the money was spent and submit a payee accounting to Social Security each year.
Since your representative payee will have complete control of how your disability benefits are used, you'll need a rep payee who's trustworthy and accountable. So how does the SSA choose your representative payee? Here's how the selection process works.
If you have a legal guardian, the SSA is most likely to select that person to serve as your representative payee. This is because the court would have already approved your guardian as a "fiduciary" (a person with the power and trust to act on your behalf).
If you don't have a guardian, the SSA will look for someone you know fairly well. Your potential representative payee should be someone who:
Spouses. If you're married, the SSA will usually choose your spouse to serve as your rep payee, provided you live together and your spouse is competent to manage your money. If you live with someone else, whether you're related or not, the SSA will generally select that person to be your rep payee.
Parents. Note that when children receive Social Security disability benefits, a parent is usually selected to serve as a representative payee. But, the SSA will choose someone else if the parent isn't qualified or has a condition that makes them unable to manage money (like a cognitive disorder or drug addiction).
Organizational payees. If the SSA determines that a recipient has both a mental disability and suffers from drug or alcohol abuse, the agency may assign an organizational payee to manage the beneficiary's funds (more on this below). Some nonprofit organizations specialize in assisting clients with these problems and can provide other social services to support their recovery.
A representative payee can be either an individual or an organization.
An individual payee is usually a family member, friend, or an attorney. If the SSA selects an individual payee for you, the agency will first conduct a careful investigation to make sure the person is the right choice. If your payee doesn't spend your money on your behalf only, he or she may face criminal charges, so the SSA is selective about who it chooses as a payee.
Although the SSA's first choice is usually an individual payee, not all recipients have someone trustworthy who can receive their benefits. If this is true for you and the SSA determines you cannot manage your own funds, the agency will select an organizational payee for you.
An organization payee can be a social service agency, nonprofit organization, health care facility, or government agency. Organizational payees usually serve multiple disability recipients.
To become an organizational payee, a representative from the organization must first file an application while undergoing a face-to-face interview with the SSA. During the interview, the SSA will discuss the following:
Once an organization is designated as a payee, its staff must undergo extensive training. Like individual payees, organizations will face criminal charges if they misuse a beneficiary's funds.
If Social Security has notified you that you'll need a representative payee, you can suggest your own rep payee. You'll want to let Social Security know your preference as soon as possible. The SSA will consider your wishes.
Your rep payee can be a friend or family member you trust. Your proposed payee must meet the SSA's requirements, including having a means of support, such as:
Because of the serious responsibilities and the money involved, some conditions can disqualify a proposed rep payee. Any of the following will disqualify someone from serving as an SSA representative payee:
If you already have a Social Security representative payee but want someone else to take over that role, you can request a change. First, you should let your current rep payee know you want to make a change. Then, the person you want to take over as your rep payee must fill out an application at a Social Security office.
If you don't know anyone you trust who also meets Social Security's requirements for a representative payee, the SSA can choose an organization to serve as the payee. That could be a social services agency, the nursing home where you live, or a financial institution that offers payee services. Any fees associated with providing this service must be approved by the SSA and would come from your disability benefits.
Social Security will notify you (by mail) when a representative payee has been selected for you. If you disagree with the SSA's choice, you have 60 days to appeal (by letter).
If you have a condition that is expected to get worse, you might anticipate needing a representative payee at some point down the road. You can have a voice in choosing your rep payee before you need one. The SSA calls this an "advance designation," and it's a pretty straightforward process.
You give Social Security the names of up to three people you trust. And if you ever need a representative payee, the SSA will consider your advance designees first when selecting one for you.
You can submit your advance designation request with your application for disability benefits or after you begin receiving benefits. You can submit your request in several ways, including:
Social Security will ask for some details about your designated rep payee, including their:
After submitting your advanced designation request, you'll get a letter from the SSA each year that confirms the name of your designee and includes information about how to update your designation.
You can receive your Social Security disability benefits directly as long as the SSA believes that you can manage (or direct the management of) your money. But if you have a condition that prompted the SSA to assign a representative payee, you'll have to prove that you're now capable of managing your money yourself.
If the SSA notifies you that you need a rep payee, you'll have 60 days to appeal that decision. To win your appeal, you'll need a letter from your doctor or someone else who knows you well stating that you can manage your own money.
If you already have a representative payee and believe you no longer need one, you might be able to get the determination reversed. But you'll have to prove that you can handle your own financial affairs to the SSA. Your proof could be one of the following:
Note: If the SSA believes your cognitive or emotional condition has improved enough that you can manage your own money and no longer need a rep payee, Social Security might review your case to see if you're still disabled enough to qualify for benefits. Learn more about what can cause the SSA to stop your disability benefits.
Updated August 31, 2023