Many disabled individuals live solely on Social Security income but lack sufficient mental capacity to handle the payment of their living expenses.  Social Security (which doesn’t recognize powers of attorney) permits the appointment of a Social Security Representative Payee (Rep Payee) upon proof of disability and confirmation that the representative would be appropriate for appointment as an alternative to a costly and cumbersome guardianship process.  Even if you are not disabled but you are collecting Social Security,  you can let Social Security know of up to three choices whom you would like to become the Rep Payee should you later become disabled.  Of course, the Rep Payee would only be appointed if you should become disabled – but you are letting Social Security know of your desire should the need arise.  You can change your mind electronically or in person (of course, office visits may be closed during a pandemic).

Each year the Rep Payee would have a duty to pay the bills of the disabled individual and should try to keep funds in an interest-bearing account (if all of the Social Security income is not being spent).  The Rep Payee would need to keep records to prove how the funds are used for the disabled beneficiary.  Reporting is done annually.  If there is a change in circumstances (i.e. Rep Payee can no longer perform the duties), Social Security should be notified.  Although an individual acting as Rep Payee cannot be paid for his or her services, they sometimes can be reimbursed for expenses in helping take care of the disabled beneficiary (i.e. travel expenses for taking the disabled beneficiary to the doctor, etc.).  Sometimes non-profit organizations can be paid a fee if they are Rep Payee for more than 50 individuals (i.e. The Senior Source acts as a Rep Payee for many and has a program to help manage funds and pay bills without guardianship).

The reporting requirements (showing that the money is used for food, clothing, shelter, utilities, dental and medical bills and personal needs) is waived for the parents of a child that is a minor or disabled living in the same household or the legal guardian of a disabled person in the same household or the spouse of the disabled individual.  However, records of the expenses should be maintained.

If you would like to know more, attend one of our free upcoming virtual Estate Planning Essentials workshops by clicking here or calling 214-720-0102.  We make it simple to attend and it is without obligation.

We would like to invite you to join our Alzheimer’s walk team, Michael’s Marchers, on October 23, 2020, to raise funds for the benefit of the Alzheimer’s Association to help find a cure for this terrible disease. Unlike prior years of a mass gathering, the Walk will be virtual where you can virtually walk with a small group or individually from any location. This will be a unique experience! Please join our Walk team (whether you contribute or not) by clicking here

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