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When a loved one receiving Social Security benefits dies, you may wonder how the government knows to stop sending this money monthly.
Or maybe there is a surviving spouse or dependent who relied on that income and wonders if he or she can continue with some type of payment.
While Social Security rules can be tricky, the bottom line is that the deceased’s benefits stop at death. For survivors, how they make a profit (or if they meet the requirements) depends on several factors.
First, it is important that the Social Security Administration be notified as soon as possible after the person’s death.
In most cases, funeral homes notify the government. There is a form available that these companies use to report death.
“The person who acts as executor [of the estate] or the surviving spouse can also call Social Security, ”said certified financial planner Peggy Sherman, senior advisor to Briaud Financial Advisors in College Station, Texas.
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There are a couple of things to keep in mind. For starters, a person has no Social Security benefits during the month of their death.
“Any benefit paid after the month of the person’s death must be reimbursed,” Sherman said.
With Social Security, each payment received represents the benefits for the previous month. Therefore, if a person dies in January, this month’s check (which would be paid in February) would have to be returned if received. If the payment is made by direct deposit, the bank holding the account must be notified so that it can return the benefits sent after the person’s death.
It is perhaps not surprising that using someone else’s benefits after death is a federal crime, regardless of whether or not the death was reported. If the Social Security Administration receives notification that fraud may occur, the allegation is reviewed and a criminal investigation may be warranted. To combat duplication, the agency matches records with other government entities to identify unreported deaths.
As for benefits available to survivors: If a eligible spouse or dependent already received money according to the deceased’s record, the benefit will automatically turn into survivor benefits when the government notifies the death, Sherman said.
“For all other cases, the surviving spouse will need to call Social Security and schedule an appointment to apply for survival benefits,” Sherman said. “You can’t do this online.”
If the widow or widower has reached their own retirement age, they can get the full benefit from their spouse, Sherman said. They can apply for reduced benefits from the age of 60, in contrast to the standard age of 62 years.
If the survivor meets the requirements to obtain Social Security according to their own record, they can switch to their own benefit at any time between the ages of 62 and 70 if their own payment would be higher.
An ex-spouse of the deceased may also claim benefits, as long as they meet certain specific requirements.
Benefits may also be available for the minor children of a deceased person, as well as for a surviving spouse to care for the children.
Finally, when a Social Security beneficiary dies, survivors typically receive a lump sum payment of $ 255.