The claimant or representative must submit the fee agreement to us before the date of the first favorable determination or decision (hereinafter, we generally refer to both as a “decision”) that the representative worked toward achieving, as explained in GN 03940.001B.

We use the date of the award or decision notice, not the date of adjudication or effectuation. In concurrent claims, the date of the first favorable decision under either title is controlling.

If we receive more than one fee agreement, we act on the latest fee agreement received before the favorable decision date. We cannot consider a fee agreement that was received after the favorable decision, even if the claimant and the representative(s) signed the agreement prior to the favorable decision.

NOTE: Parties cannot submit a new fee agreement in lieu of an appointment, withdrawal, or revocation of a representative’s appointment. The claimant or representative must submit a new Form SSA-1696 (Claimant’s Appointment of a Representative) to appoint a new representative and the claimant or representative must submit a separate writing to revoke or withdraw an appointment.

The claimant, the claimant’s legal guardian, the parent of a child under the age of 18, or the representative must submit a fee agreement in writing. The parties may submit a fee agreement in person, via mail, fax, or other approved electronic method (see GN 03940.001C). The parties may also submit a photocopy or fax of the original fee agreement. The agreement is only valid if all parties, including the claimant and all appointed representatives who have not waived the right to a fee, sign the same agreement.

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  A court appointed representative, a parent or legal guardian of a child under age 18, or the court-ordered legal guardian of a claimant judged legally incompetent (refer to GN 00502.139 for more information when a guardian is involved) may sign the fee agreement on behalf of the claimant.

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  A claimant under age 18 may sign the fee agreement if we determine that individual capable of managing their own benefits. For information on developing capability for children, see GN 00502.070.

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  Unless we have reason to doubt the representative’s intent to sign the fee agreement, we can accept a representative’s stamped signature on the fee agreement. However, we cannot accept a fee agreement with only the stamp or name of an entity, rather than of an individual(s). While we may make direct payment of a fee to an entity with a valid assignment (see GN 03920.021), we do not recognize firms, corporations, or other entities as representatives. The fee agreement must show the name(s) and signature(s) of each individual representative who is a party to the fee agreement.

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  We may contact the parties for clarification if the signatures are illegible or questionable.

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  The fee agreement may be signed by multiple individuals as long as the claimant appointed at least one of them; however, we will only recognize and authorize a fee to the individual(s) who are, or were previously, properly appointed representative(s). We will not include in our fee considerations any individual who signed the fee agreement but who was not appointed.

The fee requested in the fee agreement cannot exceed the lesser of 25 percent of the past-due benefits or the fee limit set by the Commissioner under the authority provided by section of the Act 206(a)(2)(A)(ii)(II). The current limit is $9,200.

The fee limit also applies to concurrent claims with a common issue. We cannot approve a fee greater than 25 percent of the combined Titles II and XVI past-due benefit amounts or $9,200 (or other statutory fee limit in effect). See GN 03920.031B for calculation of past-due benefits for representative fee purposes in Title XVI only and concurrent claims and GN 03920.030B.4. for Title II only claims.

We accept language in a fee agreement that permits a later increase in the statutory fee limit in effect, or “fee cap,” as of the day we approve the fee agreement. For additional information about increases to the fee cap and examples, refer to GN 03920.006. We also accept language that sets the percent or fee limit at an amount lower than the fee cap. However, we will not accept language that establishes a minimum fee amount that may result in a fee of more than 25 percent of the past-due benefits.

To approve a fee agreement, the agency’s decision in the underlying claim must be fully or partially favorable. This can be a favorable decision on a claim or a post-entitlement or post-eligibility (PE) action that establishes additional eligibility or entitlement. See GN 03940.001B.5 for more information.

We still approve a fee agreement even if our decision is favorable to the claimant under only one title in a concurrent claim, so long as the agreement meets all other statutory conditions and no exceptions apply.

We must only approve a fee agreement when the favorable decision results in past-due benefits. If we initially approved a fee agreement on the condition that there were past due benefits, but at the time we effectuate the favorable decision, we find that there are no past-due benefits, we cannot process the fee agreement approval. In these situations, we must notify the representative(s) and the claimant that the representative(s) must file a fee petition in order to charge and collect a fee. For notice language, refer to NL 00720.050.

The fee agreement process applies only to claims of entitlement to or eligibility for past-due benefits, including claims for initial entitlement or eligibility, PE actions that involve new entitlement or eligibility for additional benefits (such as a disability cessation appeal), and reopenings after termination.

We must disapprove fee agreements where the entitlement or eligibility has already been established, such as PE actions that only adjust benefit amounts or remove payment suspensions from benefits (e.g., changes in workers’ compensation offset, resolution of earnings discrepancies, increased payments from work ending while disabled), even though the decisions may result in additional past-due benefits.

We do not consider representative’s hours and services when deciding whether to approve or disapprove the fee agreement.

We do not consider agreements or other arrangements between the claimant and the representative that are unrelated to the authorized fee. Some examples include:

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  Agreements for the payment of out-of-pocket expenses (e.g., costs involved in obtaining copies of medical reports or paying state sales tax). Reasonable out-of-pocket expenses are not subject to our review. For more information on fees not subject to our review, see GN 03920.010.

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  Agreements that a third party will pay the representative part of the authorized fee.

  NOTE: The representative cannot charge or receive a total fee for services provided on the claim(s) that exceeds the statutory fee limits or the amount we authorized, even if the fee is being paid in part by the claimant and in part by a third party. A representative must submit a statement of the fee expected from a third party as part of, or in addition to the fee agreement if the representative is eligible for and requesting direct payment. 

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  The right to charge interest on the unpaid balance of the authorized fee.

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  A plan to share the authorized fee with another person who referred the case.

There is a statutory right to request administrative review of the amount set as the maximum fee. Therefore, we do not consider language in the agreement concerning administrative review. We explain administrative review rights in our fee determination notice.

The death of the claimant, whether before or after we issue a favorable decision, does not affect our review of the fee agreement.

Additionally, after we issue a favorable decision, we do not consider the death of the representative in deciding whether to approve or disapprove a fee agreement. The decision maker notifies the deceased representative’s executor or estate administrator of the fee agreement approval, redacting any personally identifiable information (PII) related to the claimant. However, if the deceased representative has validly assigned direct payment of an authorized fee to an entity, it is not necessary to notify the deceased’s estate of the fee agreement determination. See GN 03920.021 for general information about assignment.

For fee payment in either situation, refer to GN 03940.009.

If the representative dies before the favorable decision, refer to GN 03940.003 D.6 in this section.

The decision maker must disapprove a fee agreement if the claimant appoints more than one representative and all representatives who did not waive their fee did not sign a single fee agreement. This requirement applies even when all representatives have validly assigned direct payment of their authorized fee to the same, or a different, entity.

We define a “single fee agreement” as one document signed by all parties regardless of whether the representatives work for the same or different entities or for themselves. Therefore, if the claimant appoints another representative after submitting a fee agreement, this additional representative must sign onto the original agreement, or the parties must submit a new agreement signed by all.

NOTE: The decision maker can approve the fee agreement if the representative(s) who did not sign the fee agreement waived charging and collecting a fee and the agreement meets all other conditions for approval.

References:

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  GN 03920.020 Waiver of Fee or of Direct Payment of Representative's Fee

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  GN 03920.050 Releasing Withheld Funds for Representatives’ Fees

A two-tier fee agreement functions as a fee agreement through a prescribed level, usually the first hearing. The decision maker can approve a two-tier fee agreement only if the level at which we make a favorable decision is within the confines of the fee agreement. For instructions on processing two-tier fee agreements, see GN 03940.005. If the claimant did not receive a favorable decision at the indicated level but receives a favorable decision at a subsequent level of review, the representative must submit a fee petition at the end of the representative's service to charge and collect a fee.

If the claimant revokes the appointment of a representative or the representative withdraws before we decide the claim, there are multiple appointed representatives who signed a single fee agreement, and one or more remain appointed on the claim, the decision maker must approve the fee agreement so long as the agreement meets all the other conditions for approval and no other exception applies.

The decision maker must disapprove the fee agreement if the claimant discharges all representatives who signed the fee agreement or all such representatives withdraw before we favorably decide the claim. We do not send a copy of the award notice or other claim(s)-related information to a former representative unless it is the minimum amount of information necessary to resolve fee-related issues.

The fee authorizer must disapprove a fee agreement if a state court declared the claimant legally incompetent prior to the date they signed the fee agreement and the claimant's legal guardian did not sign the fee agreement.

The fee authorizer must not disapprove a fee agreement only because the claimant is mentally incapable of managing funds and requires a representative payee, or because we are evaluating the claimant's mental capability.

References:

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  GN 03940.037 Title II - FO and PC Processing of Fee Agreements on Claims Involving Mental Capability - General

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  GN 03940.051 Field Office Processing of Fee Agreements on Title XVI or Concurrent Titles II and XVI Claims Involving Mental Capability

The decision maker must disapprove the fee agreement for a suspended or disqualified representative if we favorably decide the claim after the effective date of the individual’s suspension or disqualification.

The decision maker must disapprove the fee agreement even if the representative had assigned direct payment of a fee to an entity. A sanctioned or disqualified individual is ineligible to receive direct payment, so any assignments they may have made also become invalid (see GN 03920.021).

For more information on processing claims with suspended or disqualified representatives, see GN 03970.060.

When a representative dies before we issue a favorable decision, the claimant or representative submitted an otherwise valid fee agreement, and there are no remaining representatives appointed on the claim(s) who had signed the same fee agreement, the decision maker must:

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  Disapprove the fee agreement at the time of the decision, and

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  Notify the parties, including the deceased's estate or the entity's point of contact (POC) if there is a valid assignment, (redacting PII, as necessary), that we disapproved the agreement, but that the individual addressed may request a fee for the deceased representative’s services by filing a fee petition (see GN 03930.020A).

In a multiple representative situation, if a representative dies but another representative(s) who signed the same fee agreement remains active on the claim, the decision maker must approve an otherwise valid fee agreement.