So I was reading a recent post and realized that I may have an issue. I am durable power of attorney for my dad who lives with me now (until Covid over) and then I will find a ALF. He has moderate dementia. I've been taking care of his finances for about 2 years now but have had DPOA for over 20 and have been a joint owner on his checking account for about 20 years. I just started paying bills thinking that was all taken care of under the DPOA. But I just read that Social Security doesn't recognize a DPOA and that I needed to be approved as a representative payee? I looked that up and it says the money can't go into his joint (with me) checking account but I must be on an account as his financial representative. Is this all REALLY necessary? It sounds like an unnecessary hassle and I'm wondering if anyone has any stories as to how doing it the way I have been has caused a problem?
All my Mom owned was an old farmhouse worth, maybe 100k. That was her estate.
As payee for my nephews annuity, which is a government pension ran like SS, all that needed to be done was that the acct be set up with only the annuity deposited in it. I guess easier to see the money coming in and going out. I am suppose to get a form every year asking for an accounting but haven't got it in years.
I really don't understand why you can't have a joint account with an adult child. This is usually done so if something does happen to a parent, the child can pay the bills without needing a POA to do so. Is it the way its worded? As long as the child deposits none of their own money the Medicaid thing doesn't matter. I was never questioned about my name being on the accounts. It was Moms money if her name was on the acct.
I never mingled Moms and my money. That causes big problems if Medicaid is needed. Since she had a house, even though she lived with me and then in an AL, I kept that address for her bills. Actually, I was unaware that I should be payee. I signed all her checks with my name and POA. Her bank statements showed the money going in and coming out. If I spent on her OP, I kept the receipts and wrote a check to myself writing the check # on the receipts and kept them in an envelope. Her small pension was not direct deposited. This was used for her personal needs and again I kept every receipt.
Like I said, I was in the dark about payee. But, I never had any problems paying Moms bills as POA. I placed her in an AL, paying all her bills out of her acct. When she entered LTC knowing that would be where she lived for the rest of her life, I allowed them to become her payee for SS and her pension. I looked at it as if there was a problem with either once she passed, the facility would have the headache not me.
There are probably loads of people who are not payee. As long as you don't change bank accts and have to inform SS of the change because of direct deposit, I wouldn't worry about it. Just make sure your records are good if there ever is a question. There is really no way that SS knows who is paying bills on Dads SS. Think of the people scammed out of their SS and SS has no idea of it.
I had records showing that all of my dads money went towards his personal needs and I did not think that social security needed an annual accounting of how his money was being spent. I set up online bill pay and withdrew money as my dad wanted it. I didn't really even need to be on the account but, I thought that it would simplify things, it didn't effect anything.
I never had a problem and I never became rep payee or needed a trust or anything else.
However, if your dad is looking at Medicaid in his future I do not recommend being on the account. I think it creates questions that are better off not being created.
IRS form? geez, OK, I will look into that!
You cannot have your father's money going into a joint account and you should NOT be co-mingling your money and his. This would make any help in future from medicaid, were it needed, impossible. There is a 5 year look back on the seniors expenditures from their assets.
Given that you don't fully understand the DPOA, I would pay a lawyer for an hour of time to find out exactly what records you should be keeping and how you should go about this. There are also books that will help.
I found that the first year, acting on my brother's behalf (at his request when he was diagnosed with probable early Lewy's Dementia, daunting. Everyone wants something different. Bad news is that you haven't even found out what the IRS wants. Yup, a whole other set of forms.