Social Security Benefits Are Not Paid
for the Month of Death
Domestic Social Policy Division
Social Security benefits are not paid for the month in which a recipient dies. In
most instances, the check an individual receives in a given month represents payment
for the preceding month. In other words, by design, the check (or direct bank deposit)
arrives after the month for which it applies. In situations where a recipient dies late in
the month, the Social Security Administration often is not notified of the death in time
to stop the payment. When family members are informed that the check must be
returned, they often complain that the policy is unfair and creates a financial hardship
because the deceased recipient incurred expenses for part (or even most) of the month.
Legislation is introduced routinely that would pay a full benefit for the month of
death, or pro-rate the benefit based on the proportion of the month that the recipient was
alive. Supporters of the legislation argue that withholding benefits for the month of
death does not make sense given that a person’s bills do not stop at the beginning of the
month in which they die. They argue that the public views the policy as anomalous in
a system designed to provide monthly income to retirees, the disabled, and survivors of
deceased workers. Critics of the legislation argue that paying full benefits for the month
of death would cost an estimated $1.6 billion annually (excluding administrative costs).
They point out that a deceased recipient’s spouse and children can collect survivor
benefits for the month of death, regardless of when the death occurred; that survivors
may be entitled to a $255 lump-sum death payment; and that those seeking to have
benefits paid for the month of death have little appreciation for the administrative
difficulties involved in determining who should get the more than 2 million final benefit
checks issued each year.
Section 202 of the Social Security Act states that benefits are paid up through the
month before the month in which a recipient dies. Thus, no benefits are paid for the
month of death. This rule has been in the law since 1939. The rule does not apply to
Medicare in which benefits are provided up to the date of death.
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Social Security benefits are paid on a monthly basis. The check (or direct deposit)
for each month’s benefit is issued in the following month. For example, the check that
an individual receives in February is for the benefit payable for January. This is referred
to as a retrospective payment system. If a recipient dies late in the month, family
members or the executor of the estate may not notify the Social Security Administration
(SSA) in time to stop the payment. Subsequently, they are informed that the check must
be returned to the government. Members of Congress are asked often to support
legislation that would provide a full or partial benefit payment for the month of death.1
Arguments For and Against Paying Benefits
for the Month of Death
Arguments for Changing the Current Policy. Critics of the current policy
argue that withholding benefits for the month of death does not make sense. They
maintain that a person’s bills do not stop at the beginning of the month in which they die.
Moreover, the deceased recipient’s family members or estate have to pay funeral and
burial expenses. The unfairness of the policy is often illustrated with a comparison of the
individual who dies on the last day of the month and receives no benefit for that month,
and the individual who dies at 12:05 a.m. the next day and receives a full benefit for the
preceding month. Critics complain that the current policy is cruel in that it adversely
affects individuals who are already distressed by the death of a family member. They find
the circumstances in which a check must be returned to the government to be the most
incomprehensible. Persons who are affected often ask questions such as Do you mean my
father (or mother) had to live each day of their final month to get a benefit for that
month? Why are family members placed at a disadvantage when a recipient dies at the
end of the month after having incurred living expenses throughout most of the month?
How could the government have established such a policy? Critics contend that the
public views the policy as an anomaly — as a mistake in the design of the Social Security
system. If the policy was intended to reduce the cost of the system, they see it as a “poor”
device to do so. They argue that the policy discredits the system by creating the
impression that it is arbitrary, unbending and thoughtlessly bureaucratic. They maintain
that benefits should be paid at least for the part of the month that the recipient was alive.
Arguments for Retaining the Current Policy. Supporters of the current policy
argue that paying benefits for the month of death would be costly. SSA estimates that
paying full benefits for the month of death would cost $1.6 billion annually.
Alternatively, paying 50% of the benefit if the recipient dies in the first half of the month,
and a full benefit if the recipient dies in the second half of the month, would cost an
estimated $1.2 billion annually. Pro-rating the benefit based on the number of days the
recipient was alive during the final month would cost an estimated $800 million
1 For related legislation in the 110th Congress, see H.R. 1380 (Social Security Benefits Fairness
Act of 2007) and H.R. 1668 (Proportionate Final Benefit Act of 2007).
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annually.2 SSA also estimated the increase in benefit payments under a proposal in which
(1) a full benefit for the month of death would be payable to a surviving spouse (the
surviving spouse would not be required to have been living with the recipient when the
death occurred or be entitled to benefits) or (2) if there is no surviving spouse, a pro-rated
benefit based on the number of days the person was alive during the final month would
be payable. SSA estimates that the proposal would increase benefit payments by $13.2
billion over the 10-year period 2004-2013.3 Supporters of the current policy also point
out that the system pays benefits to an individual beginning with his or her first month of
entitlement, regardless of when entitlement began during the month, and that this provides
rough balance in the system for not paying benefits for the month of death. Moreover,
survivor benefits are payable to eligible family members beginning with the deceased
recipient’s month of death, regardless of when the death occurred during the month. In
addition, the spouse who was living with the worker, or a spouse or child eligible for
survivor benefits may receive a lump-sum death payment of $255. They contend that
there is little appreciation for the administrative difficulties (and potential costs) involved
in determining who should get the deceased recipient’s benefit for the month of death.
SSA cannot simply mail a check to the deceased recipient. Rather, SSA would have to
determine who should receive the payment. Because more than 2 million recipients die
each year, this would require a labor-intensive process, similar to the taking of regular
benefit applications. Each case would have to be investigated, and if there are multiple
family members, the payment may have to be split. Careful attention would have to be
given to determining the proper payee(s) in each case.4
2 SSA estimates are unpublished data for 2002. Estimates reflect an increase in benefit payments
only — they do not take into account an increase in administrative costs as a result of the policy
change. Estimates assume no change in auxiliary benefits.
3 SSA estimates prepared in 2003 assume the proposal would be effective for deaths after 2003
and are based on the intermediate assumptions of the 2003 Social Security Trustees’ Report.
Under the proposal, the increase in benefit payments would be subject to the family maximum.
4 Data on the number of benefits terminated, by reason for termination — including death, are
published in SSA’s Annual Statistical Supplement, 2007, table 6.F2; see [http://www.social
security.gov/policy/docs/statcomps/supplement/2007/6f.pdf]. In cases where a lump-sum death
payment is made under current law, the process of determining the proper payee(s) would be less
difficult. Other cases would require more thorough investigation.
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