When disabled individuals in North Carolina are children under the age of 18 and the are receiving Supplemental Security Income through the Social Security disability program, they will have a representative payee who oversees the disabled person's funds. A dedicated account must be opened when the child is set to receive a large past-due payment. Generally, this is for payments that cover more than six months at the benefit rate as it currently stands. Past-due payments will be deposited into the dedicated account. There are restrictions on the representative payee's ability to use these funds.
With the dedicated account, there are certain requirements that must be adhered to. It must be separate from the account that is utilized for the regular SSI benefits the person receives per month, and it can only be a savings, checking, or money market account. There can be no commingling of funds apart from past-due SSI. The account is not allowed to be in a certificate of deposit, stocks, trusts, bonds, or mutual funds. And the title must indicate that the child is the owner of all money in the account, including interest.
Money in the dedicated account can be used only for medical treatment of the child and for education or job skills training. The SSA will allow certain expenses in addition to that if they are to the child's benefit, such as nursing care in the home, special equipment, modifying the house, rehabilitation and therapy, or other items that the SSA has approved, such as legal fees. The money in the dedicated account cannot be used for basics like clothes, food, or shelter.
The dedicated account will be monitored via a report that the representative payee will complete. There must be receipts, bank statements, and other records submitted to the SSA. For help with understanding the role of the representative payee, a dedicated account, and complying with all the requirements for SSI Supplemental Security Income for a child, a lawyer may be essential.
Source: Social Security Administration, "Spotlight On Dedicated Accounts For Children -- 2017 Edition," accessed on Oct. 10, 2017