Social Security Representative Payee vs. Power of Attorney - AMAC Foundation

One rumor our Social Security Advisory Service encounters is that there’s no need for a Representative Payee designation if you have Power of Attorney (POA) for a beneficiary. This rumor causes confusion when a relative or close family friend steps up to help a Social Security beneficiary manage their financial affairs. After all, a POA helps manage most financial tasks on someone else’s behalf. The basic definition, per Merriam-Webster Dictionary, is authorization for an “agent to carry on business or an enterprise for the principal.”

What is a Social Security Representative Payee?

The Social Security Administration (SSA) provides a clear definition of the Representative Payee program on its website. In general, the program enables a third party to act on behalf of a beneficiary to manage their payments received from SSA. But there’s more to it than that. SSA, for example, may require some payees to provide a Representative Payee Report annually, and all payees are accountable to maintain records of receipts and disbursements on behalf of a beneficiary.

So, what if you hold a Power of Attorney for a Beneficiary?

Many folks assume that having a POA would allow access to a beneficiary’s Social Security records or facilitate their dealings with the SSA on matters regarding that person’s work record or Social Security benefits. Unfortunately, that’s not the case, since Treasury Department regulations do not recognize POA for negotiating recurring federal payments, including Social Security or Supplemental Security Income (SSI) payments (see Title 31, Section 240.17 CFR). SSA’s Representative Payee designation serves as a workaround for those situations where a beneficiary is incapable of managing his or her own Social Security or Supplemental Security Income benefits.

How do I become a Representative Payee?

To become a Representative Payee, a designee must meet with SSA and request the designation.  If approved, the Representative Payee may need to comply with annual reporting requirements and will be accountable for 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. They may be subject to educational visits and payee reviews at the discretion of SSA.

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