What Representative Payees Cannot Do with Social Security Funds

checkPeople who collect disability benefits can rely on others to manage their Social Security or Supplemental Security Income payments. A friend, relative, or even an organization can serve as the beneficiary’s representative payee, giving that trusted entity control over what can and cannot be purchased using disability funds. This is an enormous responsibility, and shouldn't be taken lightly.

Limitations on What a Representative Payee Can Do

A representative payee has a great deal of control over a beneficiary’s finances. However, there are limits to what a payee can and cannot do. Firstly, the person cannot act as payee until he or she has gone through an official application and interview process at the nearest Social Security office. Simply being power of attorney isn't automatic authorization to be a representative payee.

Once appointed, payees can be held legally accountable if they:

  • Steal from the beneficiary. Payees are forbidden from mixing his or her personal funds with the beneficiary’s funds. The only payments that can be made to payees are for expense reimbursement made out-of-pocket, such as a trip to a restaurant.
  • Misuse funds. Payees are required to spend the beneficiary's money only on the payee's medical needs and personal expenditures. If a representative is caught misusing a beneficiary's funds, he or she will not only have to repay the beneficiary, but also face fines and even imprisonment if found guilty.
  • Act as a legal representative. Status as a payee only gives a person control over a beneficiary’s Social Security payments. It doesn't give the payee any right to sign legal documents on behalf of the beneficiary—other than Social Security documents—or give him or her power of attorney.
  • Falsify benefit reports. Representative payees must keep detailed records and file accurate reports with the Social Security Administration every year. Payees can be charged with criminal offenses if they falsify records, such as failing to report other income or benefit changes, or supply misleading information about how the beneficiary's benefits were spent throughout the year.

Are you having trouble getting Social Security benefits owed to you? Call us today or fill out the form on this page to speak to an attorney about your Social Security disability claim.

 

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