TN 7 (06-10)

PR 08305.016 Illinois

A. PR 10-099 Request for Legal Opinion: Deceased Number Holder Thomas A. B~ —REPLY

DATE: May 27, 2010

1. SYLLABUS

As per Sec. 204. [42 U.S.C. 404(d) of the Act and 20 C.F.R 404.503(b), an underpayment owed to a deceased beneficiary can be paid to survivors according their priority of payment. The second and fifth levels of priority state that children of the beneficiary are eligible to receive the underpayment. The definition of child, as per 20 C.F.R. 404.357 includes a definition of a stepchild. This definition makes no distinction between adult or minor stepchildren. A prior precedent, SSA 70-3, which addressed a similar eligibility of the stepchildren to collect an underpayment under Sec. 204. 42 U.S.C. 404(d) of the Act and 20 C.F.R 404.503(b) only discussed minor children. The law, regulations, and prior precedent opinion are all silent with regards to the eligibility of the adult stepchild to collect an underpayment owed to a deceased beneficiary.

2. OPINION

BACKGROUND

The NH married Ethel B~ on July 25, 1983, in Illinois. At the time of their marriage, Ethel had six children, ranging in age from 15 to 29 years old. The marriage ended in Ethel’s death on January 29, 2002.

The NH died on May 31, 2008, while domiciled in Illinois. At the time of the NH’s death, Ethel’s six children were all adults.

As a result of the Special Disability Workload Project, the NH has been awarded Social Security disability benefits effective September 1975 and is due an underpayment of $153,554.32.

Edna N~, the NH’s surviving mother, has filed a claim for payment of his underpayment. Ethel’s six adult children have also filed a claim for the underpayment.

DISCUSSION

When an individual dies before a payment due under Title II is paid, payment of the amount due is made in order of priority to persons described in § 204(d) of the Act. The statute provides that, when no individual is entitled to benefits on the deceased NH’s account at the time of his death, and there is no surviving spouse, an underpayment is paid “to the person or persons, if any, determined by the Commissioner of Social Security to be the child or children of the deceased individual (and, in case there is more than one such child, in equal parts to each such child).” Section 204(d)(5) of the Act; see also 20 C.F.R. § 404.503(b)(5). The deceased NH’s children are higher in priority than the deceased NH’s parents. See Section 204(d)(5)-(6) of the Act; 20 C.F.R. § 404.503(b)(5)-(6).

The regulations and POMS explain that, for purposes of distributions of underpayments to a child, SSA uses the same definition of “child” as provided in § 216(e) or (h)[1] See 20 C.F.R. § 404.503(b)(5); POMS GN 02301.030(B)(2). Under § 216(e), the term “child” includes a “stepchild who has been such stepchild for…not less than nine months immediately preceding the day on which such [insured] individual died.”

Although the Social Security Act does not define the term “stepchild,” the regulations and SSA policy define that term. See 20 C.F.R. § 404.357; POMS GN 00306.230(A)(1)-(2); AR 86-12(9); SSR 66-11. The regulations at 20 C.F.R. § 404.357 state, in relevant part:

You may be eligible for benefits as the insured’s stepchild if, after your birth, your natural or adopting parent married the insured….The marriage between the insured and your parent must be a valid marriage under State law…If the insured is not alive when you apply, you must have been his or her stepchild for at least 9 months immediately preceding the day the insured died.

In other words, a child is the stepchild of a NH for purposes of Title II only if: (1) the NH contracted a valid marriage with the child’s mother under state law while the relationship of parent and child existed between the mother and child, and (2) the child remained the NH’s stepchild for at least nine months immediately preceding the NH’s death.[2]

Here, the validity of the marriage between the NH and Ethel in 1983 under Illinois law has not been raised as an issue. In addition, Ethel’s six children were all born prior to the date of the marriage. The duration requirement has also been met, as the NH and Ethel were married much earlier than the requisite nine months before the NH’s death in 2008. See POMS GN 00306.320(A)(2) (in death claim, marriage between NH and child’s parent must have taken place at least nine months before NH’s death). Although Ethel died in 2002, SSA policy provides that the death of a spouse does not end the parent-stepchild relationship. See SSR 70-3; POMS GN 00306.230(A)(3)(a). Thus, Ethel’s six children were the NH’s stepchildren for at least nine months immediately preceding his death.

SSR 70-3 involves a factual situation almost identical to this case, except that the surviving stepchildren were minors. In that ruling, SSA held that the stepchildren of the deceased NH qualified as “children” within the meaning of §§ 204(d) and 216(e) of the Act, and thus had a higher priority of entitlement to the NH’s underpayment than the NH’s parents. See SSR 70-3. Here, Ethel’s six children were all adults at the time of the NH’s death. However, the POMS indicates that age is not relevant when determining a child’s eligibility for an underpayment. See POMS GN 02301.030(B)(2). Thus, the fact that Ethel’s six children are adults, and all but one were adults at the time of Ethel’s marriage to the NH, does not affect their status as the NH’s stepchildren for purposes of the right to receive an underpayment.

You asked whether the step-children could inherit from the NH as his children. Section 216(h) of the Act provides that, in determining whether a claimant is the child of an insured individual, SSA determines whether the claimant could inherit the NH’s intestate personal property as the NH’s child under state law. However, step-children are not required to meet the inheritance rights test. See POMS GN 00306.230(A)(1)(c); POMS PR 01605.026(A) (PR 04-138 Effect of Divorce on Stepchild Relationship for Purposes of Distributing DIB after Death Underpayment); compare 20 C.F.R. § 404.355 (applying inheritance rights test to determine who is a natural child), with 20 C.F.R. § 404.357 (applying a different test to determine who is a stepchild).

In Hutcheson v. Califano, 638 F.2d 96 (9th Cir. 1981), the Court of Appeals for the Ninth Circuit held that, since the term “stepchild” was not specifically defined in the Social Security Act, and there was no federal common law for family relationships, the definition of “stepchild” as provided by state law was controlling. See id. at 98-99. Subsequently, SSA issued an acquiescence ruling, which applies only to cases in which the claimant resides in the Ninth Circuit (i.e., California, Arizona, Nevada, Oregon, Washington, Idaho, Montana, the Northern Mariana Islands, Alaska, Hawaii, American Samoa, or Guam) at the time of the determination or decision. See AR 86-12(9); see also POMS GN 00306.390. You indicated that none of Ethel’s six children who are claiming the underpayment resides in a Ninth Circuit state. Therefore, the acquiescence ruling does not apply.

At this present time, Applicant has not presented adequate proof that she entitled to receive NH's underpayment as the legal representative of NH's estate. Therefore, Applicant is not entitled to NH's underpayment.

Donna L. C~

Regional Chief Counsel Region V

By: ____________________
_ Cristine B~

Assistant Regional Counsel


Footnotes:

[1]

You asked whether the step-children could inherit from the NH as his children. Section 216(h) of the Act provides that, in determining whether a claimant is the child of an insured individual, SSA determines whether the claimant could inherit the NH’s intestate personal property as the NH’s child under state law. However, step-children are not required to meet the inheritance rights test. See POMS GN 00306.230(A)(1)(c); POMS PR 01605.026(A) (PR 04-138 Effect of Divorce on Stepchild Relationship for Purposes of Distributing DIB after Death Underpayment); compare 20 C.F.R. § 404.355 (applying inheritance rights test to determine who is a natural child), with 20 C.F.R. § 404.357 (applying a different test to determine who is a stepchild).

[2]

In Hutcheson v. Califano, 638 F.2d 96 (9th Cir. 1981), the Court of Appeals for the Ninth Circuit held that, since the term “stepchild” was not specifically defined in the Social Security Act, and there was no federal common law for family relationships, the definition of “stepchild” as provided by state law was controlling. See id. at 98-99. Subsequently, SSA issued an acquiescence ruling, which applies only to cases in which the claimant resides in the Ninth Circuit (i.e., California, Arizona, Nevada, Oregon, Washington, Idaho, Montana, the Northern Mariana Islands, Alaska, Hawaii, American Samoa, or Guam) at the time of the determination or decision. See AR 86-12(9); see also POMS GN 00306.390. You indicated that none of Ethel’s six children who are claiming the underpayment resides in a Ninth Circuit state. Therefore, the acquiescence ruling does not apply.

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http://policy.ssa.gov/poms.nsf/lnx/1508305016
PR 08305.016 - Illinois - 06/17/2010
Batch run: 11/29/2012
Rev:06/17/2010