• January 23, 2018

What You Need to Know About Being a Representative Payee

What You Need to Know About Being a Representative Payee

What You Need to Know About Being a Representative Payee 1024 635 Patrick J. Thomas Agency

A representative payee, not to be confused with a personal representative, is a person or organization who is charged with using the benefits distributed to a vulnerable person to pay for his or her basic needs.

Understand the Rules That Guide You

There are different types of representative payees, depending on where the vulnerable person is receiving their benefits from (The Social Security Administration (SSA), the department of Veterans Affairs (VA), etc.). Although both are federal entities, they each have their own set of rules and standards that representative payees must abide by. Before beginning your service as a representative payee, make sure you understand what is expected of you as well as the rules you must follow.

This also applies to the authority that you have over the benefits received by the protected person. The power and authority you receive from the SSA is different than the VA.

Know the Basic Duties and Responsibilities

Being a representative payee differs from being a conservator. Whereas conservators are responsible for managing the assets within a protected person’s estate, representative payees are only responsible for paying for the current or foreseeable needs of a person using the benefits they receive. A representative payee can use a protected person’s benefits to:

  • Pay bills (rent, utilities, etc.)
  • Purchase food, clothing, and other necessities

What if There is Money Leftover?

In many cases, the benefits received will be more than what is needed to care for a protected person. If this is the case, representative payees are usually allowed to make purchases that improve the life and comfort of the beneficiary. These types of purchases can sometimes include:

  • Home repairs
  • Vehicles
  • Household items
  • Schooling, classes, etc.

Check with the entity paying the benefits to see which purchases qualify.

Keep All Records and Receipts

Since representative payees are required to have an accounting every year, it is imperative to keep good financial records that show no fraud or mismanagement of funds is taking place. Save all receipts to justify purchases made and to prove that no money has been leftover or misappropriated.

Maintain a Balance With Your Life

Before taking on the role of a representative payee, it’s important to understand what will be required of you and how these responsibilities fit into your life. Many people underestimate the work that goes into being a representative payee and thus struggle to balance their work and personal lives with their new responsibilities.

Before you begin, take the time to fully understand how this will change your life moving forward.

Don’t Forget the Surety Bond

In many cases, representative payees are required to post a representative payee bond. If you are uncertain what this means, or if you have questions on how to obtain one, contact The Patrick J. Thomas Agency today.


Disclaimer: this is for informational purposes only and is not intended to be legal advice. If you need legal counsel, please contact an attorney directly.