That “Final” Benefit Check—A Source of Some Confusion

A Social Security beneficiary’s passing is generally a traumatic time for all concerned, and a variety of details and things that need to be addressed often create stress and concern on the part of the survivors. One of them is the question of how to handle the deceased’s final benefit check, and the answer may not be as straightforward as you might think.

Before addressing the disposition of that final check, let’s revisit two fundamental points that can have a bearing on what to do with it. First, remember that Social Security pays benefits the month after they are due, meaning that the benefit payment when received is applicable to the preceding month. For example, a check received in July is actually June’s benefit payment.

Second, Social Security does not prorate monthly benefits. Regardless of birthdate, a benefit due for that month is paid in a full amount rather than a prorated of partial amount. For example, an eligible beneficiary born on the last day of the month would receive a full payment for the month they begin to draw, even though their eligibility technically began on the last day.

OK…so what about that check that arrived during the month the beneficiary died or after the beneficiary’s death but before the end of the month? Since that benefit payment was actually for the previous month, it’s a valid payment for the estate. The confusion around the handing of checks arises when a payment arrives the month after the beneficiary’s death. In this case, since the beneficiary was not alive the entire month, and since benefit payments are not prorated, that check must be returned to the Social Security Administration (SSA). Chances are, of course, that SSA, the U.S. Treasury, or the beneficiary’s bank might have been made aware of the death in time to stop the payment.

And just to make it even more confusing, there can be situations where the agencies involved (SSA, Treasury, or the bank), having been made aware of the death, may have stopped payment of a benefit validly due to the beneficiary’s estate. If the beneficiary’s benefit payment is scheduled for, say, the fourth Wednesday of the month, and the death occurred early in the month, this could easily happen since the SSA’s Death Alert Control and Update System (DACUS) automatically compares the information received with its master files to ensure that erroneous payments after death are blocked. In cases like this, immediate contact with the SSA, either by telephone or online, will result in the payment being re-issued.

Yes, it can be confusing, but don’t forget that the AMAC Foundation’s Social Security Advisory Service is available to help you with any questions you may have in situations like this. Just contact us at 888-750-2622 or via email at [email protected] for immediate information…there’s no charge for this service!

This article is presented as a service of the AMAC Foundation. If you need assistance on Social Security matters, contact our free Social Security Advisory Service at 888-750-2622 or via email at [email protected].

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