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What is a Representative Payee?

A representative payee is a person or an organization that Social Security appoints to receive the Social Security or SSI benefits for anyone who can't manage or direct the management of his or her benefits. A payee's main duties are to use the benefits to pay for the current and future needs of the beneficiary, and properly save any benefits not needed to meet current needs.

A  payee must also keep records of expenses. When Social Security requests a report, a payee must provide and accounting to us of how he or she used or saved the benefits.

Who Needs a Payee?

The law requires most minor children and adults who are physically and/or mentally unable to manage their money to have payees. Someone who is considered unable is unable to manage their own affairs due to mental incapacity (such as deterioration or psychosis) or sometimes due to a serious physical disability.

This person becomes a beneficiary, or a person who receives Social Security and/or Supplemental Security Income (SSI) payments. Social Security and SSI are two different programs.

What Are the Duties of a Representative Payee?

A representative payee (payee) manages benefit payments for beneficiaries who are incapable of managing their Social Security or Supplemental Security Income (SSI) payments. Social Security law and regulations require payees to use the payments they receive for the current needs of the beneficiary and in their best interests.

Required Duties:

  • Determine the beneficiary's needs and use his or her payments to meet those needs;
  • Save any money left after meeting the beneficiary's current needs in an interest bearing account or savings bonds for the beneficiary's future needs;
  • Report any changes or events which could affect the beneficiary's eligibility for payments;
  • Keep records of all payments received and how you spent and saved them;
  • Provide all records of how payments are spent or saved to SSA upon request;
  • Report to SSA any changes that would affect your performance or your continuing as payee;
  • Complete reports accounting for your use of payments, as required;
  • Return to SSA any payments to which the beneficiary is not entitled; and
  • Return to SSA any payments saved when you are no longer the representative payee for the beneficiary.

What Is the Proper Use of Benefits?

Payees must use benefits for current needs (such as food, clothing, shelter, utilities, dental and medical care, and personal comfort items), or for reasonably foreseeable needs. If not needed for these purposes, payees must conserve, invest, or use the benefits in the best interests of the beneficiary, according to the payee's best judgement.

A payee cannot:

  • Sign legal documents, other than Social Security documents, for a beneficiary.
  • Have legal authority over earned income, pensions, or any income from sources other than Social Security or SSI.
  • Use a beneficiary's money for the payee's expenses, or spend funds in a way that would leave the beneficiary without necessary items or services (housing, food, medical care).
  • Keep conserved funds once you are no longer the payee.

FASI Program

FASI follows guidelines set by the Social Security Administration for the standards and practices of managing beneficiaries funds. Fiduciary bank accounts are set up for every client individually. We do NOT hold a beneficiary's funds in a collective account. This allows us to manage day-to-day needs and conduct comprehensive reports easily and accurately.

FASI coordinates with Case Managers, shelter home operators, parents/guardians, and family members to help manage recipients' finances successfully.

  • Potential clients fill out and return to FASI the FASI application.
  • FASI will submit a payee application to the Social Security Administration.
  • When the payee application has been approved by SSA, and benefit amount and type are determined, FASI will open a fiduciary account.
  • FASI will contact the beneficiary and Case Manager, guardian, house manager, or other persons(s) who has knowledge of the beneficiary's expenses to determine the needs of the beneficiary.
  • FASI will generate a monthly budget. Budget will be generated according to rules and guidelines of SSA. Meaning that all bills and expenses will be acknowledged and paid before any personal spending is dispersed.
  • Accuracy of each beneficiary's account is measured via daily tracking, monthly Reconciliation Report, and a quarterly account audit.
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