2019.Direct Payment of Authorized Fee to a Representative

2019.1When does SSA make (or certify) direct fee payments to your representative?

Prior to February 28, 2005, if you were represented by an attorney and your claim was for old age, survivors, or disability insurance benefits (title II benefits), we could withhold up to 25 percent of past-due benefits. We could certify for direct payment to the attorney the lesser of the amount of the authorized fee or 25 percent of past-due benefits. Also, for appointments prior to February 28, 2005, we assumed no responsibility for the payment of any fees, if the representative was not an attorney or the claim was for SSI (title XVI) benefits.

For representation agreements entered into on or after February 28, 2005, we continue to make payments to attorneys for title II benefits as before, but also can make direct payment to an attorney if your claim is for SSI benefits. In addition, we can make direct payment to a non-attorney representative whom we determine is eligible to receive direct payment, if your claim is for SSI or old age, survivors, or disability benefits.

All new representatives must register with SSA by completing Form SSA-1699. In addition, any previously registered representative who is eligible and wants their fee directly paid by SSA from withheld past-due benefits must submit an updated SSA-1699 with the necessary direct payment information and submit Section 5 of the revised Form SSA-1696. We do not make direct payment to a representative if the representative waives the right to direct payment.

2019.2Does SSA charge to pay your representative directly?

When SSA makes direct payment to a representative, the law requires us to deduct 6.3 percent from the representative's fee to cover administrative costs. This “user fee” cannot exceed $117.00 (effective December 2023, or a higher amount based on annual adjustments). The representative cannot charge or collect this expense from you.

2019.3When does SSA pay the fee?

We will pay an authorized fee to a representative soon after we determine the fee amount, unless one of the parties (e.g., you or your representative) requests review before we issue the payment. If that occurs, we will not pay the representative until we have completed the review and notified the parties of the determination.

2019.4How does a representative receive direct payment if there is no fee agreement?

If there is no fee agreement or we disapprove a fee agreement, the representative must file a fee petition or notice of intent to submit a fee petition with us in order to receive direct payment of a fee from past-due benefits. The representative must file the petition or notice of intent within 60 days of notification of a favorable determination, i.e., the Award Notice.

2019.5If the claimant has deposited a fee into an escrow account, what must the representative who is eligible to receive direct payment do to receive payment?

When you and a representative have a trust or escrow agreement (to assure payment of an authorized fee), the representative must identify and disclose the amount of the trust or escrow account when he or she files a fee agreement or petitions us for a fee. The representative must also disclose any payment(s) toward this fee that may have come from a source other than you. We reduce direct payment to the representative by any amount you deposited into a trust or escrow account and any payments toward the fee from some other source.

2019.6What must the representative do if the total amount of the authorized fee is unavailable from your withheld past-due benefits?

If we cannot certify the total amount of the authorized fee for direct payment out of past-due benefits, the representative must look to you and any auxiliary beneficiaries for the balance.

2019.7If a Federal court rules in favor of a claimant, what fee may an attorney collect and how?

If a Federal court rules in your favor, the court may allow, as part of its judgment, a reasonable fee to an attorney who represented you in court. The court may award your representative court fees under the Social Security Act as well as fees under the Equal Access to Justice Act (EAJA). If your attorney receives court fees for the same work under both Acts, the attorney must refund the smaller fee to you.

Prior to February 28, 2005, the fee allowed by the court cannot exceed 25 percent of your and your family's tiitle II past-due benefits resulting from the favorable judgment. Beginning February 28, 2005, the fee allowed by the court may also include 25 percent of your title XVI past-due benefits. We may certify the amount of the fee awarded by the court (if the PDBs amount we withheld is sufficient) to directly pay your attorney out of your past-due benefits. If it is not sufficient, your attorney will look to you for payment of the balance due.

In addition, if a Federal court rules in your favor, your attorney may request, under EAJA, reimbursement of the expenses he or she incurred in representing you in the course of the court action