what is the difference between a power of attorney and a representative payee?

by Raymundo Kub 7 min read

An agent under power of attorney still needs to act in the best interest of the person who gave it to her and spend the funds for that person's benefit but a representative payee is something more.Mar 13, 2018

Is power of attorney the same as representative payee?

Being an authorized representative, having power of attorney, or a joint bank account with the beneficiary is not the same as being a payee. These arrangements do not give legal authority to negotiate and manage a beneficiary's Social Security and/or SSI benefits.

Can a POA change a Social Security direct deposit?

No. The Social Security Administration does not recognize power of attorney as conferring authority to manage another person's benefits.

What are the rights of a payee?

Your payee receives your payments for you and must use the money to pay for your current needs. After your payee pays those expenses for you, your payee can use the rest of the money to pay any past-due bills you may have, provide entertainment for you, or save the money for your future use.

Who Cannot be a representative payee?

A representative payee applicant may not serve if he/she: (a) Has been convicted of a violation under section 208, 811 or 1632 of the Social Security Act. (b) Has been convicted of an offense resulting in imprisonment for more than 1 year.

What happens if representative payee dies?

We'll reissue the funds to the beneficiary or the new payee. If the beneficiary dies, you must give any saved benefits belonging to their estate to the legal representative of the estate, or the savings must be managed according to state law.

Is a representative payee a fiduciary?

A representative payee is appointed by the Social Security Administration for another person who needs help managing their Social Security or Supplemental Security Income benefit payments. ... As a Social Security representative payee, you are a fiduciary.Aug 18, 2020

Can a payee withhold money?

Your Representative Payee Cannot Withhold Funds as Punishment. The funds in a beneficiary's account are to be used for the beneficiary only. Period. The representative payee cannot make decisions about the funds that are not in the best interests of the beneficiary.Sep 24, 2019

Does a representative payee get paid?

Are Representative Payees Paid? Individual representative payees cannot collect a fee for services provided to the beneficiary. If you are the legal guardian of the beneficiary, however, you may be able to collect a guardian fee if the court has authorized it.

What happens if a payee misuse funds?

When a representative payee misuses funds, we may refer the case for criminal prosecution. The penalty upon conviction for a payee's misuse of funds may be a fine of up to $250,000, imprisonment up to 10 years, or both.Apr 26, 2010

Does a representative payee get a stimulus check?

In this case, representative payees will receive the stimulus payments on behalf of their beneficiaries in the same way they get monthly benefit payments — namely, by direct deposit, Direct Express debit card or paper check.Jun 17, 2020

How do I remove myself as a representative payee?

If, for some reason, you wish to remove a representative payee, you must prove that you're mentally and physically able to manage the payments received. This requires filling out the appropriate forms and submitting your application. In some cases, the Social Security Administration (SSA) may interview the beneficiary.

Can a rep payee have a debit card?

It is important to remember that you are not allowed to give the beneficiary direct access to the bank account as the representative payee. That means you cannot just hand over the debit card to your child. However, many companies offer programs that help young people (and adults) manage their money.Oct 22, 2020

What is the Difference Between a Representation Agreement and Power of Attorney?

The differences between representation agreements and powers of attorney are found within the type of permissions that they grant a representative.

What is a Representation Agreement?

A representation agreement will allow your representative to make decisions regarding your health and personal care. These documents are most useful in situations involving ailing family members, aging parents or loved ones, and people facing any kind of serious medical procedure.

What is a Power of Attorney?

When you give somebody power of attorney over your affairs, you are allowing them to make decisions regarding your legal and financial dealings.

What is a representative payee?

A representative payee is a person or an organization. We appoint a payee 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 ...

Is a power of attorney the same as a payee?

Being an authorized representative, having power of attorney, or a joint bank account with the beneficiary is not the same as being a payee. These arrangements do not give legal authority to negotiate and manage a beneficiary's Social Security and/or SSI benefits. In order to be a payee, you must apply for and be appointed by Social Security.

What is a beneficiary in Social Security?

A beneficiary is a person who receives Social Security and/or Supplemental Security Income (SSI) payments. Social Security and SSI are two different programs. we administer both. Who Needs a Representative Payee? The law requires most minor children and all legally incompetent adults to have payees.

Does the Treasury recognize power of attorney?

The Treasury Department does not recognize power of attorney for negotiating federal payments, including Social Security or SSI checks. This means, if you have power of attorney for someone who is incapable of managing his or her own benefits, you must still apply to serve as his or her payee.

Can a payee sign a document other than Social Security?

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.

What is a power of attorney?

Power of attorney is a legal process where one individual grants a third party the authority to transact certain business for that individual. It does not lessen the rights of the individual and does not usually grant the third party the right to manage the individual's assets.

What is a Durable Power of Attorney?

Durable Power of Attorney) – this is when you give another person legal authority to act on your behalf, by making financial or legal decisions for you, when you are incapacitated or otherwise unable to.

What is a personal representative?

However, let’s first start with the definitions of the two: Personal Representative ( sometimes an Executor or Administrator) – this is when an individual has the right and responsibility to manage the finances, property, and other assets of the deceased ; the individual is appointed by the Court during the probate process, ...

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Representative Payee (SSA) Law and Legal Definition

The term Representative Payee is unique to the Social Security Administration (SSA); however the role of representative payee is simply one of agency, that is, the representative payee is the designated agent for a recipient of Social Security benefits whom the SSA has determined to be incapable of managing his or her SS or SSI benefits

What is a trustee in a trust?

The trustee may be an individual or legal entity to which the settlor transfers legal title/ownership to the trust. The trustee managers the assets (funds) within the trust for the benefit of the beneficiaries. It is common that the settlor names themselves as the trustee to retain access to the funds. There can be multiple trustees. Privileges vary from trust to trust and are stated within the document. Distributes the funds according to the instructions in the trust when the settlor passes away.

Who is the settlor of a trust?

This person does not always have access to the trust. The only way they can access this trust is by being named the trustee.

What is a beneficiary in Social Security?

beneficiary is a person who receives Social Security and/or Supplemental Security Income (SSI) payments. Social Security and SSI are two different programs and both are administered by SSA.

Who is the successor trustee?

The successor trusteeis the person who is named by the settlor/grantor to take over the role of trustee when a current trustee resigns, dies or become incapacitated. When this happens, the successor trustee becomes the trustee. Typically there is more than one successor trustee named either to become a co-trustee or as the second successor trustee.

Who is the beneficiary of a trust?

The beneficiary is the person who is entitled to the benefit of the trust arrangement. The beneficiary is normally a person; however, could be a company, organization or charity.

Who is the representative payee?

representative payee is a person or an organization appointed by the Social Security Administration (SSA) to receive the Social Security and/or SSI benefits for anyone who can’t manage or direct the management of his or her benefits/money.

What is a personal representative?

A personal representative is responsible for settling your estate after you die. An estate is all the property you owned at the time of death, and settling the estate means transferring that property to new owners. The personal representative, sometimes called an executor, gets her power from the probate court.

What powers does an attorney in fact have?

Powers. An attorney-in-fact has only those powers that the principal decides to grant. These come in myriad forms, but typically include making health care decisions when the principal is not able to do so, or conducting business on the principal's behalf. A personal representative's powers are often similar to someone who receives financial powers ...

Can you give someone power of attorney?

If you want to allow someone else to make decisions on your behalf, you can grant power of attorney. A power of attorney is a document where you, the principal, give someone else, the agent or attorney-in-fact, the legal authority to make certain kinds of decisions. You can only create a power of attorney if you are an adult who has the mental capacity to make your own decisions.

Can a principal grant a power of attorney?

A principal can grant power of attorney at any time , and terminate the agent's powers at will. All powers of attorney terminate upon the principal's death, and no agent can continue to act on behalf of the principal once the principal dies.