Being a representative payee means you're responsible for managing someone else's SSI benefits. It's an important job that requires care and attention. Here's how to do it right.
In this article, we'll cover:
- What a representative payee does
- Managing the funds properly
- Record keeping and accounting
- Common mistakes to avoid
1. What a Representative Payee Does
Your role:
- Receive SSI payments on behalf of beneficiary
- Use funds for their current needs
- Save any excess for them
- Report to Social Security
Who you serve:
- Adults unable to manage their own finances
- Minor children
- People with certain disabilities
- Those SSA determines need help
Your authority:
- Manage their SSI funds
- Make spending decisions for them
- Keep records
- Communicate with SSA
Your limitations:
- Can't use funds for yourself
- Must prioritize beneficiary's needs
- Must account for spending
- Subject to SSA oversight
2. Managing the Funds Properly
Priority spending:
- Food
- Housing (rent, utilities)
- Clothing
- Medical care not covered by insurance
- Personal needs
Saving excess funds:
- If current needs are met
- Save in interest-bearing account
- Keep separate from your money
- For beneficiary's future needs
What NOT to do:
- Mix with your personal funds
- Use for your own expenses
- Make risky investments
- Give to others
For children (dedicated accounts):
- Large back payments must go in dedicated account
- Limited uses (education, medical, therapy, etc.)
- Keep separate from regular SSI
- More restrictions apply
Important: The money belongs to the beneficiary, not you. Every dollar should benefit them.
3. Record Keeping and Accounting
What to track:
- All SSI payments received
- All expenses paid from SSI
- Current balance
- Saved amounts
Keep receipts:
- Major purchases
- Bills paid
- Medical expenses
- Everything significant
Annual accounting:
- SSA requires Representative Payee Report
- Form SSA-6230 (adults) or SSA-6233 (children)
- Explains how you used the funds
- Must complete each year
The accounting form asks:
- How much SSI was received
- How much spent on food and housing
- How much spent on other needs
- How much saved
If you don't complete it:
- You could be removed as payee
- Benefits could be suspended
- Legal consequences possible
- Take it seriously
4. Common Mistakes to Avoid
Mixing funds:
- Keep beneficiary's money separate
- Don't put in your personal account
- Dedicated account for beneficiary
- Clear records of what's theirs
Using funds improperly:
- No personal use
- No loans to yourself
- No gifts to others from their funds
- Prioritize their needs
Not keeping records:
- Save receipts
- Track all spending
- Document everything
- Be ready for SSA questions
Missing accounting:
- Complete annually
- Meet deadlines
- Be thorough
- Don't ignore it
Not reporting changes:
- Living situation changes
- Income changes
- Address changes
- Report promptly
SSI-Specific Responsibilities
Resource limit:
- Keep beneficiary under $2,000
- Monitor balance on the 1st
- Spend down if needed
- Consider ABLE account
Reporting requirements:
- Changes in income
- Changes in living situation
- Changes in resources
- Address changes
If beneficiary works:
- Report earnings
- Understand work incentives
- Track for SSA reporting
- May affect SSI amount
Getting Help
If you have questions:
- Contact Social Security
- Call 1-800-772-1213
- Visit local office
- Ask for guidance
If being a payee is too much:
- You can resign
- SSA will find replacement
- Give proper notice
- Assist with transition
Resources:
- SSA representative payee guide
- Local social services
- Disability organizations
- Benefits counselors
How Purple Helps
Purple makes payee duties easier:
- Clear tracking of SSI deposits
- Organized spending records
- Resource limit monitoring
- Easy documentation for accounting
- Separate management from personal funds