When someone collects Social Security disability benefits, it's usually because they're unable to work due to mental or physical limitations. Both Social Security disability insurance (SSDI) and Supplemental Security Income (SSI) disability benefits provide monthly payments so that the recipient can maintain financial independence despite the disability.
Unfortunately, some people collecting Social Security disability benefits are mentally ill, addicted to alcohol or drugs, or have reached a point in their illness where they can no longer handle their own finances. When this happens, the Social Security Administration (SSA) will usually appoint a representative payee.
This article will explain what a representative payee is and why Social Security might appoint a "rep payee." It will also cover who can serve as a representative payee and what you must do if you're appointed as one.
A representative payee is a person or organization that receives someone's SSDI or SSI disability benefits on their behalf. If you're serving as a representative payee, you must use the Social Security payments for the disabled person's support and care only. You can use the money for any of the following:
Social Security generally assumes that most adults can manage their own finances. But there are times when that isn't the case. The SSA might appoint a representative payee for a disabled person who is:
If there's reason to believe that a disabled adult can't handle their own money, the SSA will investigate to determine if the agency should appoint a rep payee. Learn more about how to prove you can be your own representative payee.
If you're serving as a Social Security representative payee, it's your job to see to the immediate needs of the SSDI or SSI recipient. You must also save any money that's not immediately needed, so it's available when it's needed to meet the disabled person's future needs. As a representative payee, you're also responsible for returning any funds that Social Security sends to the recipient in error (overpayments).
As a Social Security rep payee, you must always act in the best interests of the disabled person when spending their SSDI or SSI benefits. You'll need to keep accurate records of all financial transactions, both incoming and outgoing. When the SSA asks for a report of expenses, which it does every year, the report should cover what you paid out and how much money was saved. (More on this below.)
As an SSA representative payee, your primary duties are to use the recipient's disability payments to do the following:
If you're the SSI representative payee for a child, you're also required to arrange for appropriate medical treatment for the child's condition.
If there are funds left over after paying the disabled person's expenses, you should place them in an interest-bearing account.
If the Social Security recipient has received a lump sum of benefits (like retroactive disability payments or backpay), you could use the payment to:
If you're the rep payee for a child who receives a lump-sum payment of SSI, you must open a dedicated SSI account.
If you're a Social Security representative payee, you can be reimbursed for expenses you paid from your own funds, but you shouldn't intermingle or mix your funds with the disabled person's funds. You're required to keep the Social Security benefits in a separate account.
You also can't sign legal documents or otherwise act as a representative of the SSDI or SSI disability recipient—becoming an SSA representative payee doesn't automatically give you power of attorney over all of the recipient's affairs. Here are some other things that you can't do as an SSA rep payee:
Any representative payee found misusing a recipient's funds must repay the misused funds. If you're found guilty of misusing the disability recipient's Social Security benefits, you'll be subject to fines and imprisonment.
If you're serving as someone's representative payee, you're required to file a report each year with the Social Security Administration explaining how the recipient's disability benefits have been used. Social Security will send you this report, called the Representative Payee Accounting Report, every year that you serve as an SSA representative payee.
You need to fill out the accounting report and return it promptly. You can complete the form you receive and mail it back to Social Security, or you can submit the report online using the SSA's online accounting form. (Note: To complete the online report, you'll need information printed on the report the SSA sent you.)
As a representative payee, it's also your responsibility to report to Social Security any changes that might affect the recipient's eligibility for payments or the benefit amount. You must report the change if any of the following occur:
Learn more about the representative payee's accounting and reporting requirements.
Both individuals and organizations can become Social Security rep payees. When appointing a representative payee, the SSA generally prefers someone who lives with and helps care for the disabled person. If the disabled person lives alone, Social Security might select a family member, friend, legal guardian, or lawyer to serve as rep payee.
Social Security could choose you to serve as a representative payee if the disabled person knows you well and sees you frequently, and you're familiar with their needs and wants. For instance, if your child receives SSI disability benefits, you (as the parent) would usually serve as the SSI representative payee (unless Social Security determines that you're not capable of managing the money).
Sometimes, a disabled person has no family member or friend who can (or will) fill the role of a representative payee. In that case, Social Security will require the disabled person to have an organizational payee.
Learn more about how Social Security chooses an appropriate representative payee.
For an individual, the process of becoming a rep payee is fairly simple. When a loved one needs you to serve as a representative payee, you need to contact the nearest Social Security office and submit an application. You'll also need to:
Like individuals, organizations that serve as Social Security rep payees must apply for the role. To qualify, the organization needs to provide services to at least five people and can't be a creditor to any of them. Organizations that can serve as Social Security representative payees include:
An organization that serves as a representative payee is sometimes allowed to collect a fee for services to the Social Security recipient, but the organization must get permission from the SSA to do so. But Social Security never allows an individual to charge a fee to serve as an SSDI or SSI representative payee. Learn more about when organizational representative payees can charge fees.
Updated October 6, 2022