The Social Security Administration (SSA) has a Representative Payment Program for individuals on Social Security and Supplemental Security Income (SSI) that need assistance in managing their finances. Anyone who serves as a representative payee will need to open a checking account that is designated specifically for the individual receiving the benefits. The SSA will then deposit monthly benefits directly into that account on or around the first of the month.
Who Are the Representative Payees
The SSA must appoint someone to serve as the representative payee for the individual who is incapable of managing their benefits. The government agency prefers a family member or friend take on this role, as they would know the individual best. In the case of a child who is receiving SSI, a parent or guardian is a natural choice. In the event that there are no friends or family members to serve as a representative payee, the SSA will appoint a qualified organization.
If you have any concerns or questions regarding the Representative Payment Program, you can call the SSA at 1-800-772-1213 (TTY 1-800-325-0778) to request an appointment to speak with an agent.
About Representative Payee Bank Accounts
According to the SSA's "A Guide for Representative Payees," any bank account that shows that the beneficiary has ownership of the account with the representative payee listed as the financial agent is acceptable. Savings accounts are allowed; however, a checking account is more practical, as you'll most likely need to use the funds to pay bills and make purchases on behalf of the individual you are representing.
It's important that the representative payee uses the benefits as permitted by the SSA. Meeting the individual's basic needs, such as housing and food, is the top priority. Beyond that, the funds can be used to pay for medical and dental expenses that aren't covered by insurance, home and automobile modifications and personal needs, like magazine subscriptions, clothing and concert tickets.
Opening a Representative Payee Account
To open a representative payee checking account, you'll need to choose a local bank with the most favorable terms (no monthly account fees, a free first set of checks, etc.). You may wish to call the bank ahead of time to make an appointment and to inquire as to the documentation needed to open the account. BECU, for example, requires applicants to bring their representative payee account application and their SSA designation letter that proves they are the appointed representative payee for the beneficiary.
When opening an account, most banks require the Social Security number of both the representative payee and the beneficiary, so make sure you know them before you go. You can expect the representative payee account application to require personal information for both parties, such as full names, mother's maiden names, birthdates and addresses. A picture ID will also be required. Finally, you'll need to sign the application and turn it into the bank's agent.
All monthly statements are sent to the representative payee's address in the beneficiary's name, as the beneficiary is the legal owner of the account.
Important Final Steps
Once the representative payee bank account has been successfully opened, you'll need to call the beneficiary's SSA caseworker to report the routing and account number for the account. The caseworker will then set up Social Security representative payee direct deposit for the benefits with the bank.
Unless you are the natural parent, adoptive parent or guardian of the individual receiving the benefits, you'll need to file a yearly Representative Payee Report on how the money in the account was spent. Make sure you save any receipts and keep an accurate checking account ledger, so you can fill out the report when it comes due.