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Power of Attorney vs. Social Security Representative Payee…Setting the Record Straight
Many folks considering the move to become a representative payee for a relative or close friend believe that if they have power of attorney already designated, that should suffice. This rumor and the assumption that accompanies it cause some confusion. After all, having power of attorney—POA—is helpful in managing most financial tasks on someone else’s behalf, since the basic definition, per Miriam Webster Dictionary, is authorization for an “agent to carry on business or an enterprise for the principal.”
Sounds like having a POA would allow someone to access someone else’s Social Security records or deal with the Social Security Administration—SSA–on matters regarding that person’s work record or Social Security benefits. Unfortunately, that’s not the case, since SSA rules do not recognize POA for negotiating federal payments, including Social Security or Supplemental Security Income (SSI) payments. As an alternative, SSA offers a Representative Payee designation for those situations where a beneficiary is incapable of managing his or her benefits.
To become a Representative Payee, a designee must meet with SSA and request the designation. If approved, the Representative Payee will need to comply with annual reporting requirements and recordkeeping regarding how the payments are spent or saved. Representative Payees can also be required to make all records available for review if requested by SSA, and may be subject to educational visits and payee reviews at the discretion of SSA.