Representative payees play a critical role in helping individuals use their Social Security or Supplemental Security Income (SSI) benefits to meet their essential needs and maximize their wellbeing. And as payees know firsthand, there are rules and restrictions about how to properly save and disburse these funds.
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Here are some key ins and outs about SSI benefits that Rep Payees navigate everyday:

1. The amount of benefits a beneficiary should receive

The maximum Federal SSI benefit is typically adjusted annually for inflation. As of January 1, 2022, the rate is $841 for an individual and $1,261 for a couple. Many states also supplement the Federal SSI benefit with additional funds. A number of factors (income, living arrangements, etc.) can impact an individual’s SSI benefit amounts and supplements from their state, so if you are managing accounts for multiple beneficiaries, they may not receive the same amount. You can use this Social Security Administration (SSA) portal to view current benefit information for your clients. 

Rep Payees are also required to report any changes or events which could affect the beneficiary's eligibility or amount of SSI payments; this may include marriage, changes in work status, receipt of benefits from other sources, etc. The amount that a beneficiary receives from Social Security or Social Security Disability Insurance (SSDI) is based on the beneficiary’s work credits (which are based on total yearly wages or self-employment income).

2. Countable resource limits

One of the key factors that determines SSI benefits eligibility is the value of a beneficiary’s countable resources. The limit for countable resources is $2,000 for an individual and $3,000 for a couple. This limit is important because if the value of a beneficiary’s countable resource exceeds this amount at the beginning of the month, they cannot receive SSI for that month. As a Rep Payee, it can be helpful to have a comprehensive understanding of any beneficiary resources and whether they are countable for SSI purposes. 

3. What SSI funds should be used for

According to the SSA: “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.” This often includes paying for an individual’s food, housing costs, medical and dental expenses not covered by insurance, clothing, and personal care items. Rep Payees can also reimburse themselves for reasonable out-of-pocket expenses paid on behalf of the beneficiary as long as they are allowable purchases and good records are kept. This might include the cost of transporting a beneficiary to a doctor’s appointment (gas, bus fare, etc.), postage to pay beneficiary’s bills, etc. You can find more information about allowable purchases in this detailed guide.

Once the current needs of the beneficiary are met, the beneficiary is allowed discretionary spending money up to $2,000 at a time, regardless of the Rep Payees opinion on whether this is a “good” use of money. If you are concerned about drug or alcohol abuse, you may want to budget out spending money in small increments, purchase items like food to give to the beneficiary directly, or choose a cashless form of payment like a True Link Visa® Prepaid Card. If you believe a beneficiary is spending their money on illegal or dangerous items, you should seek help from a social service agency and/or request guidance from your local SSA office or by calling 1-800-772-1213.

4. Requirements for receiving and holding funds

The SSA recommends that Rep Payees hold benefits in a checking or savings account to protect against loss or theft. It is important that beneficiary funds not be mixed with your own or other funds and that account titles show the beneficiary’s ownership of the funds with the payee listed as the financial agent. 

Organizations managing funds for several beneficiaries are allowed to use a single checking or savings account known as a “collective account” as long as they follow relevant rules, including: 

• Any account titles must show the funds belong to the beneficiaries and not the Rep Payee;
• The account must be separate from the organization’s operating account;
• Any interest earned belongs to the beneficiaries;
• There must be proper procedures to document credits and debits with clear and current records of each beneficiary’s share; and
• The organization must make the account and supporting records available to the SSA when asked.

5. Maintaining appropriate records

Speaking of recordkeeping, the SSA also requires Rep Payees to: keep records of all payments received and how they are spent or saved, provide these records upon request, and complete an annual accounting. This SSA portal allows Rep Payees to submit these reports online while tools like True Link can help make recordkeeping and reporting simpler with access to clients' transaction histories, all in one place.   

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This article is not intended to provide investment, legal, tax, accounting or medical advice. Before making decisions involving investing, legal, tax, accounting or medical concerns, you should consult appropriate professionals regarding your specific situation.

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