• Chris Stein, CFP®

Final Social Security Payment

We received the following question from a reader this week regarding a Social Security payment made to someone who is deceased:

“My mother recently passed away and I am handling her affairs.  I have heard conflicting information about what happens to her final Social Security payment.  She passed away on October 16th.  Social Security deposited her money in her account shortly after that.  I have been told that the SSA will take that money back.  Is this true?”

Rules of Entitlement for Benefits

The basic rules of entitlement for benefits require that the beneficiary be alive through the entire month in order to receive payment for that month.  Since she passed away before reaching the end of October she is not entitled to the October payment.

However, the payment you mention was actually for her September benefit.  Many people forget that the SS benefits are paid the month after they are earned, so the deposit in October was for the month prior benefit.

You may have another issue however.  If Social Security is not notified of her passing soon enough they may send out her October benefit payment in November.  Since she is not entitled to that payment they will take that payment back, and have up to 12 months to do so.  They will generally do it much sooner, but if they do not you will need to leave those funds in the account until they do.

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