You have asked us to review a petition for a temporary restraining order and modification
of child support pending before the Porter County (Indiana) Superior Court, and to
provide appropriate language with which to respond to concerns addressed by Sandra
L~, a representative payee potentially affected by the petition. The petition asks
the court to order Ms. L~ to pay over to Derek F~, her ex-husband, $21,752 dollars
in lump-sum auxiliary benefits that SSA owes to Sandra’s and Derek’s minor children.
The petition also asks the court to restrain Sandra from cashing or otherwise using
the back-benefits. SSA is not a party to the court case. We have reviewed the petition,
and conclude that the state court lacks authority to take the action that the petition
requests. We have attached proposed language that can be used in a letter to the representative
payee and her attorney. Below we explain the basis for that proposed language. We
recommend that the letter be sent as soon as possible, so that the representative
payee can consult with her attorney and the attorney can respond to the petition before
the August 2010 hearing currently scheduled on the matter.
In 2007, Sandra (n. L~) and Derek F~ divorced. Ms. L~ received custody of their minor
children, Ashley and Amber F~. The Porter County (Indiana) Superior Court ordered
Mr. F~ to pay monthly child support. At some time after the divorce, Mr. F~ was found
to be permanently disabled and unable to return to work. Mr. F~ has reported that
he is receiving a combination of Disability Insurance Benefits (DIB) from SSA and
group long-insurance disability benefits from his employer. Mr. F~ reports that his
insurance company advanced him a sum of $68,705.10, which he is expected to repay
from his Social Security benefits. Mr. F~ further reports that he has turned over
to his insurance company the sum of $46,953.00 that SSA paid to him in lump-sum back-benefits,
leaving him a balance of $21,752.10 due to the insurance company.
Ms. L~ reports that after Mr. F~ began receiving DIB, she applied for auxiliary benefits
for Amber and Ashley on Mr. F~’s account, and asked SSA to name her as the children’s
representative payee. SSA made Ms. L~ the representative payee, and informed her that
in addition to monthly benefits, SSA would certify $21,752.10 in lump-sum back benefits
to her for the benefit of Ashley and Amber. Mr. F~ has petitioned the court to order
Ms. L~ to pay this sum over to him, so that he may use the money to pay off his remaining
debt to his insurance company. He has also asked the court to restrain Ms. L~ from
cashing, spending or in any other way disposing of the lump sum payment from SSA.
Mr. F~ maintains that neither Ms. L~ nor the children are entitled to the lump-sum
payment, because he has continued to pay child support during the pendency of the
There are three main problems with the proposed court order in this case. First, it
seems to assume that the children’s benefits belong to the father, rather than to
the children. Second, the state court lacks authority to direct the use of such benefits.
Third, if the benefits were used in the manner that the order proposes, Ms. L~ would
violate her obligations as representative payee.
I. Auxiliary disability benefits belong to the dependent beneficiary, not the wage-earner.
Title II of the Social Security Act (Act) provides Disability Insurance Benefits (DIB)
to disabled workers who have worked long enough and paid Social Security taxes. In
addition to primary disability benefits paid to the disabled wage-earner, the disability
insurance program also provides dependent or auxiliary benefits to certain family
members of the disabled worker. 42 U.S.C. §§ 402(a)-(d). This includes children of
divorced parents who are not living in the household of the disabled person. 42 U.S.C.
§ 402(d). Such an award is consistent with one of the purposes of the Act, which is
“to provide a minimum level of income to children who would otherwise not have sufficient
resources[.]” Washington Dep’t of Social and Health Services v. Guardianship Estate of Danny Keffeler, 537 U.S. 371, 373 (2003). Although dependent children become eligible for an award
of benefits based on their parent’s eligibility for DIB, the Act and Social Security
regulations unambiguously state that these children “shall be entitled” to such benefits
as individuals in their own right. 42 U.S.C. § 402(d), 20 C.F.R. §§ 404.351-369. Because
the plain language of the statute makes it clear that auxiliary benefits are awarded
directly to the dependent, and not to the disabled person, dependent disability benefits
are deemed to be the property of the child who receives them. In re Unisys Corp. Long-Term Disability Plan ERISA Litigation, 97 F.3d 710, 716 (3d Cir. 1996).
II. State courts lack authority to control the use of Social Security benefits.
A. Only the Commissioner may choose a representative payee and tell the payee how
to use benefits.
Congress granted the Commissioner sole power to determine who should manage a beneficiary’s
benefits and how they should be managed. 42 U.S.C. § 405(j). That power includes the
right to appoint or remove a representative payee, and the right to direct the representative
payee on matters relating to benefits that the payee manages. Id.; 20 C.F.R. §§ 404.2025, 404.2035, 404.2040, 404.2045, 404.2050. 404.2065. Under the
Supremacy Clause of the United States Constitution and the doctrine of sovereign immunity,
state courts lack jurisdiction to override the Commissioner’s authority. United States
Const. Art. VI, clause 2; Hercules Inc. v. United States, 516 U.S. 417, 422-23 (1996); United States v. Commonwealth of Kentucky, 252 F.3d 816, 825 (6th Cir. 2001); see also Commonwealth of Puerto Rico v. United States, 490 F.3d 50, 61 (1st Cir. 2007). Consequently, only the Social Security Administration
has the discretion and authority to direct a representative payee as to her responsibilities.
SSA generally appoints and pays benefits to a representative payee when a beneficiary
is under the age of 18, and thus presumed unable to manage or direct the management
of benefits payments due to youth. 20 C.F.R. §§ 404.2001(a), 404.2010(2)(b). Once
appointed, a representative payee has a responsibility to use the benefits received
on the beneficiary’s behalf only in a manner and for the purpose she determines to
be in the beneficiary’s best interest. 20 C.F.R. § 404.2035(a). SSA considers that
payments certified to a representative payee have been used for the use and benefit
of the beneficiary if they are used for the beneficiary’s current maintenance, which
includes costs incurred in obtaining food, shelter, clothing, medical care, and personal
comfort items. 20 C.F.R. § 404.2040(a)(1) (specifying how a representative payee should
use the beneficiary’s benefits). Benefits may also be used for the beneficiary’s reasonably
foreseeable future needs. POMS GN 00603.001(A). After the payee has used the benefit payments for current maintenance, any remaining
amount must be conserved or invested on behalf of the beneficiary. 20 C.F.R. § 404.2045(a)
(directing the investment of conserved funds by a representative payee). A payee may
not be required to use benefit payments to satisfy a debt of the beneficiary that
arose prior to the first month for which payments are certified to a payee. 20 C.F.R.
§ 404.2040(d). A payee may satisfy a debt that arose prior to the date of the first
payment “only if the current and reasonably foreseeable needs of the beneficiary are
met.” 20 C.F.R. § 404.2040(d).
If SSA determines that the payee has not used the benefit payments or carried out
her responsibilities in accordance with SSA guidelines, or is unable to manage the
benefit payments according to those guidelines, SSA will promptly terminate payment
of benefits to the payee and find a new payee. 20 C.F.R. §§ 404.2025, 404.2035(e),
404.2050(b)-(c), (f), 404.2065. If SSA determines that the payee misused the benefit
payments, she may responsible for paying back those benefits. 20 C.F.R. § 404.2041(a).
B. The Social Security Act prohibits the use of court orders to transfer a beneficiary’s
benefits to another person.
The Social Security Act protects a beneficiary’s right to receive Social Security
by prohibiting the assignment or attachment of benefits:
The right of any person to any future payment under this title shall not be transferable
or assignable, at law or in equity, and none of the moneys paid or payable or rights
existing under this title shall be
subject to execution, levy, attachment, garnishment, or other legal
process, or the operation of any bankruptcy or insolvency law.
42 U.S.C. § 407(a) (emphasis added). “Legal process” means any “judicial or quasi-judicial
mechanism . . . by which control over property passes from one person to another[.]”
Washington Dep’t of Social and Health Services v. Guardianship Estate of Danny Keffeler, 537 U.S. 371, 385 (2003). That includes court orders. POMS GN 02410.001. The anti-assignment provision thus constitutes a “broad bar against the use of any
legal process to reach all social security benefits,” and is intended to protect the
rights and benefits from all attempts to use legal process to alienate them, unless
Congress has specifically indicated otherwise. Philpott v. Essex County Welfare Board, 409 U.S. 413, 417 (1973). Social Security benefits can be garnished to pay for an
individual’s child care obligations. 42 U.S.C. § 659. However, because the benefits
in this case belong to the children, a court order could reach the benefits only for
support of the children’s children. Benefits belonging to the children cannot be used
to fund their father’s child support obligations to them, which is what the proposed
order is asking the court to do. A state court may take the fact that the children
are receiving auxiliary benefits into account when determining how much child support
the father should pay.
III. Ms. L~ would violate her responsibility as representative payee if she were to
pay her children’s benefits to Mr. F~.
Mr. F~’s petition asks the Porter County Superior Court to compel Ms. L~ to pay her
children’s lump-sum benefits to Mr. F~, so that he can satisfy a debt that he has
incurred with his insurance company. For the reasons stated above, the Porter County
Superior Court lacks jurisdiction to compel Ms. L~ to pay her children’s lump-sum
benefits to Mr. F~, or to override SSA’s regulations regarding how Ms. L~, as representative
payee, should manage the benefits belonging to her children. That is a power that
Congress has granted exclusively to the Commissioner. If the state court granted Mr.
F~’s petition, the court’s judgment would constitute a legal process assigning control
of Ashley and Amber’s benefits to someone other than the representative payee, which
is prohibited by statute. State courts do not have jurisdiction and are prohibited
under 42 U.S.C. § 407 from directing how and to whom benefits will be paid. Therefore,
SSA will hold Ms. L~ to SSA’s standard for representative payee irrespective of any
state court order purporting to direct her to use the benefits in a certain way.
Mr. F~ is not and never has been the representative payee for his children. Mr. F~
has no basis for appropriating money corresponding to benefits belonging to his children
and using that money to satisfy his own child support obligations, or to repay a debt
he himself incurred, even if the money he borrowed was used to pay his child support
obligations. But a child’s auxiliary benefits belong to the child, not to either parent.
Even if Mr. F~’s debt could be attributed to his children – which does not appear
to be the case under the facts available to us – SSA’s regulations would not require
Ms. L~ to use the children’s benefits to pay that debt. 20 C.F.R. § 2040. A payee
may not be required to use benefit payments to satisfy an obligation that arose prior
to the first month for which payments are certified to a payee. 20 C.F.R. § 404.2040(d).
A payee may satisfy a debt that arose prior to the date of the first payment “only
if the current and reasonably foreseeable needs of the beneficiary are met.” 20 C.F.R.
For these reasons, the Porter County Superior Court cannot override SSA’s the regulations
regarding how Ms. L~, as representative payee for Ashley and Amber, should manage
the benefits belonging to the children. Granting Mr. F~’s petition would constitute
a legal process assigning control of Ashley and Amber’s benefits to someone other
than the representative payee, and would constitute a taking by judicial order of
identifiable Social Security benefits. By issuing the judgment, the state court would
assume authority to decide how Ashley and Amber’s benefits shall be managed, a power
the Congress has granted exclusively to the Commissioner. Thus, even if the court’s
direction of the benefits were intended to benefit the children, it would still be
invalid, because state courts do not have jurisdiction and are prohibited under 42
U.S.C. § 407 from directing how and to whom benefits will be paid.
The Porter County Superior Court has no authority to direct Ms. L~ to pay Ashley and
Amber’s benefits to Mr. F~. A proposed letter to Ms. L~’s attorney is attached to
this opinion. We recommend that this letter be sent out as soon as possible, since
there is a court hearing scheduled in the matter in mid-August, 2010.
Donna L. C~
Acting Regional Chief Counsel
Julie L. B~
Assistant Regional Counsel