SSI Appeals - When You Are Right and SSA is Wrong · Lillesand, SSI Appeals for Elder Law...

Lillesand, SSI Appeals for Elder Law Attorneys,

SSA Appeals for Elder Law Attorneys – When You Are Right and SSA is Wrong, What Do You Do?

David Lillesand, Lillesand, Wolasky & Waks, P.L., Clearwater, Florida

TABLE OF CONTENTS

Introduction ................................................................................................................................................ 3

I. Initial considerations and reporting responsibilities ............................................................................... 3

Background ................................................................................................................................... 3

SSI Reporting responsibilities ......................................................................................................... 4

What types of things must be reported ......................................................................................... 4

Failure to report ............................................................................................................................. 5

Typical scenario that doesn’t require immediate reporting by the drafting attorney .................. 5

Typical scenarios that do require immediate reporting ................................................................ 6

Who should do the reporting ......................................................................................................... 7

II. Dealing with SSA adverse determinations ............................................................................................. 8

SSA appeal procedures .................................................................................................................. 8

Statutory and procedural requirements for representing your client before the agency .......... 11

Fee petition process ........................................................................................................ 11

Fee agreement process ................................................................................................... 12

Collecting a fee from the Trustee ................................................................................... 12

Notifying SSA of your representation ............................................................................. 12

First steps in the appeal – responding to requests for information ............................................ 12

Request for Reconsideration ....................................................................................................... 13

Procedural rules for a Reconsideration Conference ....................................................... 13

Who will be there ............................................................................................................ 14

What will happen ............................................................................................................ 14

When will the conference be scheduled ........................................................................ 15

Request for Hearing ..................................................................................................................... 15

When will the hearing occur ........................................................................................... 15

Where will the hearing be held ....................................................................................... 16

Outside help? .................................................................................................................. 17

Scheduling the hearing ................................................................................................... 17

Review the ODAR file ...................................................................................................... 17

What you should submit ................................................................................................. 17

Procedure at the hearing ................................................................................................ 17

Who should be there ......................................................................................... 18

What to bring ..................................................................................................... 18

Conduct of the hearing ...................................................................................... 18


Appeals Council Review ............................................................................................................... 19

Federal court review .................................................................................................................... 20

Conclusion ................................................................................................................................................. 21

ATTACHMENTS – 16 Exhibits, 53 Pages ...................................................................................... 22

Exhibit A Matrix

Exhibit B SSI spotlight on Trusts

Exhibit C Eight step‐action charts for d4 Special Needs Trusts

Exhibit D SSA Appeals Procedure Flowchart

Exhibit E Request for Reconsideration (blank)

Exhibit F Request that benefits continue pending appeal

Exhibit G Request for Reconsideration (filled in)

Exhibit H Reconsideration Conference POMS

Exhibit I SNT Evaluation forms

Exhibit J Request for Hearing (blank)

Exhibit K Request for Hearing (filled in)

Exhibit L Request for Review of Hearing Decision/Order (by Appeals Council)

Exhibit M POMS SI 02301.310 GK payments continue pending appeals

Exhibit N Fee Petition Form

Exhibit O Form 1696 Appointment of Representative

Exhibit P Form 1695 for Direct Payment of fee


SSA Appeals for Elder Law Attorneys – When You Are Right and SSA is Wrong, What Do You Do?

David Lillesand, Lillesand, Wolasky & Waks, P.L., Clearwater, Florida

Introduction. It’s important to know if your state is a 1696 state, an SSI state or a 209b state. The difference has to do with whether your state agrees that if SSI awards benefits Medicaid eligibility follows automatically (“1696 state”), agrees to use SSI rules to determine Medicaid eligibility (“SSI state”) or applies its own Medicaid rules (“209b state”).

In addition, there are a few states that say they are a “1634 state” but then carve out for themselves the right to analyze the SNT trust and apply their own state rule. For example, Texas is one of those states. Pursuant to Regional POMS SI DAL01730.009 (TX), SSA/State Agreements under Section 1634, “the Texas Health and Human Services Commission (THHSC) entered into an agreement under Section 1634 of the Social Security Act with the Social Security Administration (SSA) for SSA to make Medicaid eligibility determinations. Supplemental Security Income (SSI) recipients who receive an SSI cash payment or are Section 1619(b) recipients automatically have Medicaid eligibility unless…[t]he State has determined that the Medicaid Trust provision applies.” The Program Operations Manual System, abbreviated as the POMS, is the controlling SSA staff manual for federal SSA employees.

The following presentation, therefore, limits its discussion to acquiring and maintaining eligibility for Supplemental Security Income (SSI) after preparation, execution and submission of a first or third party Special Needs Trust to the Social Security Administration (SSA) for approval, with emphasis on the practical and legal steps to take if SSA disapproves the trust.

I. Initial considerations and reporting responsibilities

Background. What do you do when SSA disapproves your perfectly-drafted trust? Litigate. This is the moment to be completely aware of your client’s rights and most importantly, the timetables and jurisdictional deadlines for appealing SSA’s adverse decision, which operate like a statute of limitations.

If you decide that you are not the kind of attorney who wants to butt heads with SSA, it is critical to now, before the crisis, establish a relationship with an experienced attorney who does Social Security appeals.

Some salient points to remember:

SSI and Social Security Disability Insurance (SSDI) are identical medically, but completely different otherwise. One is welfare (SSI) and one is paid-up prepaid insurance for which there are no income or asset tests. Millionaires get SSDI. SSDI checks stay the same each month; SSI can fluctuate monthly based on receipt of other earned or unearned income. See Matrix, Exhibit A attached.

To be eligible for SSI benefits, a claimant has to meet the medical and the non-medical federal regulations for eligibility.

We’re dealing with a small part of the population. Of the 311 million people in the United States, only 4.5 million receive SSI-only benefits, and another 1.6


million receive a small SSI disability benefit to supplement their SSDI benefits. For Texas, of 25.7 million residents, the number of SSI recipients is 533,336 of which 219,700 get both SSDI and SSI with the related Medicare and Medicaid health insurance programs.

Not all SSA attorneys are the same: the vast majority only handle initial disability claims on the medical issue – Does the claimant meet the medical eligibility rules to be awarded disability. A very few SSA attorneys will also handle financial appeals.

Elder law attorneys need to understand that for every thousand cases on appeal, maybe only one or two involve non-medical eligibility (issues involving boyfriend-girlfriend status, immigration, deeming of spousal or parental income). Perhaps one in 5,000 cases will involve a trust.

Furthermore, the SSA institutional expertise in non-medical issues resides almost exclusively with local SSA district office staff, not with the federal Administrative Law Judges.

What starts the review process that causes SSA to look at your trust?

SSI reporting responsibilities. It’s important also to understand when “reporting” is due, and who should do it. When a person applies for SSI disability benefits at the local SSA district office, SSA Claims Representatives (CR) do an initial financial eligibility screening, and if the claimant passes that test, the claim is forwarded for the medical eligibility determination. If medically approved, the SSA CR does a pre-effectuation review in more detail for financial eligibility. It is possible to win the battle, prove medical eligibility at an ALJ hearing, and ultimately lose the war – no benefits are paid – because the more exhaustive financial review proved that the claimant was never financially eligible in the first place, or because financial or personal living arrangement or circumstances changed.

The important point is that once SSA establishes the SSI claimant’s financial eligibility, the law shifts the burden of reporting changes to the claimant to report any circumstances that would affect financial eligibility, with the reporting due within ten days of the first of the month after the change occurred.

What types of things must be reported. The claimant must report any of the changes listed below to SSA, because they may affect eligibility for SSI and the benefit amount:

1. change of address;

2. change in living arrangements, including acquiring a federal common-law spouse (boyfriend/girlfriend publicly “holding out” as a married couple);

3. change in earned and unearned income, including a change in wages or net earnings from self–employment, including the spouse's income if the claimant is married and living together, and parents’ income if applying for a child;

4. change in resources including a spouse's resources, if married and living together, and parents’ resources if applying for a child;

5. death of spouse or anyone in the household;


6. change in marital status;

7. change in citizenship or immigration status;

8. change in help with living expenses from friends or relatives;

9. eligibility for other benefits or payments;

10. admission to or discharge from an institution (such as a hospital, nursing home, or a correctional institution such as prison, jail, detention center, boot camp, etc,);

11. change in school attendance, if you are under age 22;

12. change in legal alien status;

13. leaving the U.S. for a full calendar month or for 30 consecutive days or more;

14. a warrant for a felony crime or for violating a condition of parole or probation is issued for your arrest. However, effective March 18, 2001, we no longer suspend or deny payments based solely on an outstanding warrant for a violation of probation or parole.

For a full list of what to report, see 20 CFR §416.708. What you must report.

Failure to report. If the claimant, or the claimant’s attorney on the claimant’s behalf, does not report changes on time and accurately, several bad things can happen:

the claimant may be underpaid and not receive all benefits due, as quickly as they should be.

SSA may overpay the claimant, and the claimant may have to pay SSA back.

SSA may apply a penalty that will reduce the SSI benefit by $25 to $100 for each time the claimant fails to report a change to SSA, or the claimant or the attorney reports the change later than 10 days after the end of the month in which the change occurred.

If the claimant knowingly makes a statement which is false or misleading or knowingly fails to report important changes, SSA may impose a sanction against the SSI payments. The first sanction is a loss of payments for 6 months. Subsequent sanctions are for 12 months and then 24 months.

The stakes are high. Draft the trust, send it to SSA promptly – unless you don’t have to. See the following.

Typical scenario that doesn’t require immediate reporting by the drafting attorney. These include your typical third party SNTs and others:

For persons not yet receiving benefits - unfunded trust. A person with disabilities who is named in another’s Last Will and Testament with a third party SNT inside the document, but with a testator who hasn’t died yet, has nothing to report. The expectancy of receiving an inheritance is not an “available resource.” The concept of available resource is critical to understanding when and what to report.

A “resource” under the federal regulations at 20 CFR §416.1201 is:


(a) Resources; defined. For purposes of this subpart L, resources means cash or other liquid assets or any real or personal property that an individual (or spouse, if any) owns and could convert to cash to be used for his or her support and maintenance. (1) If the individual has the right, authority or power to liquidate the property or his or her share of the property, it is considered a resource. If a property right cannot be liquidated, the property will not be considered a resource of the individual (or spouse).

Therefore, draft the Will with the testamentary trust for the testator, but no reporting is required because the disabled beneficiary may never see the money. The beneficiary could pre-deceased the testator, or the testator’s could die penniless or debts may outstrip assets and the beneficiary inherits nothing. The beneficiary does not have “the right, authority or power to liquidate the property” to provide the resource necessary for his food and shelter.

Also included in the non-reporting category would be a stand-alone (a document separate from the Last Will and Testament) but unfunded third party trust.

The same non-reporting would include preparation of a life estate deed where the owner of the homestead property has reserved for herself the right to life in the home and to revoke the deed at any time in the future.

Typical scenarios that do require immediate reporting by the drafting attorney. These include:

For persons not yet receiving benefits - funded trust. The first party trust drafted pursuant to Section 1917(d)(4)(A) or (C) of the Social Security Act, hereafter “d4” trusts, the trust must be presented to the SSA CR at the time of the initial application for SSI benefits. The attorney should prepare a packet to explain that the trust to be reviewed and should pass muster under SSA rules (POMS SI 01120.203). There are no SSA federal regulations on SNTs.

Our office includes the following with the packet: a copy of the trust document, a copy of the SSI Spotlight on Trusts (see Exhibit B attached), the relevant 8 step “Step-Action” chart from the POMS (Exhibit C attached); and the paperwork that describes and tracks the type of funds or property going into the trust, the bank accounts, and the accountings of the trust to date.

EXAMPLE: Child with developmental disabilities was not eligible for SSI during minority due to deeming of parent’s resources (assets) and income. At age 18, deeming stops. Child had savings or other disqualifying resources in child’s name. Before the application can be filed for SSI, the funds are moved to a d4 trust. The trust, and supporting documents are filed with the application.

For persons receiving SSI benefits - funded trust. The d4 trust is created and funded with only $100. That is clearly under the $2,000 resource limit.

Should the trust be reported to SSA? Absolutely!

Notice that number 4 in the list of changes that must be reported to SSA above is “change in resources.” It does not limit the reporting to “change of resources that would put the claimant over the $2,000 resource limit.” First of all, the attorney does not know what other resources the claimant has already reported, or more importantly, may exist in public records. Secondly, our firm is often dealing with multi-party personal injury (PI) lawsuits. A defendant may offer a


nominal sum under the $2,000 resource limit that we use to fund the trust. The trust must be reported to SSA regardless of the amount of its funding.

The trust may accept additional funding until the claimant’s 65th birthday. Is that reportable? Yes. Not because a second d4 SNT is required, but because of the SSI sacred principle of the relationship between income and resources: income is anything that “comes in” during a month, and must be reported to SSA as income; if retained to the first of the following month, it becomes a resource. More succinctly stated: “Income in the month received becomes a resource in the following month.”

EXAMPLE: On February 1, 2013, the SSI claimant received his February SSI check of $710. The SSI claimant’s PI case is settled, liens paid, and the $100,000 net distributed to the claimant or placed in claimant’s d4 SNT on February 5, 2013. The funds went directly from the PI attorney’s trust account to the d4 SNT. The claimant has $100,000 of countable unearned income in the month of February which must be reported to SSA by March 10, 2013. The claimant will have an overpayment of $710 due to SSA because she had too much income in the month of February ($710 Federal Benefit Rate less unearned income of $100,000 received in February, equals not eligibility for SSI for the month of February). However, if the claimant’s funds are transferred to a proper d4 SNT trust before March 1st, the funds will not be a disqualifying resource. By March 10th, the claimant reports the receipt of the PI award (by providing a copy of the Closing Statement showing the gross settlement, liens paid, net to claimant; the documents necessary to show that the funds went from the PI attorney’s trust account to the claimant’s checking account, and from there to the SNT, and the bank statements or accountings of the SNT to the date of reporting, plus the SSI Spotlight on Trust, the POMS step-action chart, etc.

The claimant will have a $710 overpayment to SSA for the month of February for being over income. The February SSI check has been received, the notice to SSA was due and complied with on March 10th (so the March check was also already received). Therefore the April check will be reduced NOT BECAUSE OF THE TRUST (an exempt resource) but because of the overpaid February income. April is the first month that SSA would have the opportunity to correct the February overpayment. The SSI principle is called “two month retrospective monthly accounting.”

On the third party estate planning side, our law firm prefers to avoid testamentary SNTs which require probate to establish the testamentary trust, and instead we prepare stand-alone third party SNTs, especially with multiple family members (parents, grandparents, aunts and uncles, siblings, etc.) who may be providing additional funds at different times. We fund the third party stand alone SNT (TP-SNT) with a nominal amount to secure the tax ID number. We submit the TP-SNT to SSA, again even if the amount is substantially less than the $2,000 SSI resource limit.

THE CARDINAL RULE: When in doubt, report.


ATTORNEY COROLLARY #1: Never, ever, ever, ever counsel your client not to report. Failure to report can be a federal felony, and an attorney’s involvement in it, a conspiracy to commit a federal felony.

ATTORNEY COROLLARY #2: Document your file.

Who should do the reporting. Legally it is the claimant’s responsibility, or if they have a SSA-appointed Representative Payee, it is the Rep Payee’s responsibility, to report changes to SSA. It is not the bank trustee’s legal responsibility to report nor the drafting attorney’s.

But when dealing with a trust, to avoid unnecessary appeals as well as legal malpractice claims, the attorney should do the reporting, using “the packet” of information suggested above, or if it is a third party SNT, a packet containing a clear statement that “this is a third party SNT to be evaluated under POMS SI 01120.200 only, which does not contain a requirement to have Medicaid payback as it is not a Medicaid qualifying trust.”

SSA Claims Reps are nice people, but with a high school education. My worst grade in law school was trusts and estates. It’s not a simple concept for some lawyers with seven years of college and law school education much less high school educated SSA CR’s to understand the difference between first party and a third party SNT, a pooled trust versus an individual trust, when Medicaid payback is required and when it isn’t. To know, in the case of third party trusts, which legalese in your document PROVES that the third party SNT beneficiary meets the three essential rules of third party trusts in the POMS section on third party trusts (in POMS SI 01120.200) that are quite different from the rules for first party SNTs (in POMS SI 01120.203.)

The best way to win an Social Security appeal is not to have one. The attorney should do the reporting.

II. Dealing with SSA adverse determinations

There are several scenarios when your perfectly-drafted trust will be reviewed by SSA. And the rights of the client are substantially different.

SSA Appeal Procedures. Those clients who are applying for SSI for the first time, and submitting your trust and supporting documents, have no entitlement to SSI benefits until the case is favorably resolved. If SSA denies the trust, the appeals process follows its ordinary course with ordinary timelines with notices of appeal to the next level due in 65 days. See Exhibit D attached.

For other SSI recipients who are in current pay status at the time they receive the inheritance or PI litigation award and you create the d4 SNT, under the U.S. Supreme Court decision of Goldberg v. Kelly, 397 U.S. 254 (1970), if special timelines are followed and claims for continued benefits made within ten days of the adverse decision on the SNT, the claimant has the “GK” right to continued SSI benefits while you administratively appeal the denial of your perfect SNT through the Reconsideration and the Administrative Law Judge hearing. The claimant will have to sign a statement that if the appeals process is not successful, the claimant will repay the SSI interim benefits paid. No problem. Advise the client to sign it.

There is some confusion at times at the local SSA district office on whether a claimant can elect to continue benefits during a non-medical appeal. SSA staff may be aware of the right to continue benefits if the issue is medical cessation (SSA claims the client is no longer disabled). That kind of cessation of benefits triggers statutory eligibility to continue benefits.


However, financial ineligibility when challenged creates a federal constitutional right to continue to receive benefits, at least through the ALJ hearing, if the client elects to do so at each stage of the process – Reconsideration and Request for Hearing. Because this issue is often confusing to SSA staff, Exhibit M has been attached to assist the attorney in convincing SSA staff that benefits may continue even in financial non-medical cessation cases. An excellent publication on continuation of benefits has been produced by the Cornell University staff titled “When are SSDI/SSI Benefits Paid Pending Appeal?” and found at http://digitalcommons.ilr.cornell.edu/edicollect/116/.

If the SSI claimant fails to file the appeal within ten days, she still has the right to file for the next level of appeal within the 65 day time limit. If she fails to meet the 65 day time limit, there are possible reasons why SSA can waive the time limit described in the POMS. Also, in some circumstances, where SSA has already terminated the benefits and a waiver of time to appeal is not allowed, a subsequent “new claim” for SSI can be filed. Certain principles of administrative res judicata may apply, however, so it is always, always best to strictly meet the guidelines.

PRACTICE NOTE. As a practical matter, however, as you will see, each level of appeal requires a filing of a timely notice, but additional documents, including the attorney’s brief, do not have to be filed at the time the notice is filed. It’s obviously better legal practice to do so, but never let an appeal deadline go by. Even if the client does not understand all the issues, tell her to file the Request for Reconsideration if at that stage, or the Request for Hearing, by herself, immediately at the local SSA district office. The rule is meet the deadline, then do what’s necessary to prepare to win.

The same procedural levels are followed in the same order for individuals who are receiving benefits as for those who are filing a first claim for SSI benefits – the initial determination that your trust makes the claimant ineligible, then the Reconsideration, then the Administrative Law Judge hearing, then to the Appeals Council in Falls Church, Virginia (a suburb of Washington, D.C.) and finally into the U.S. District Court in Texas (or whatever is the appropriate district based on the claimant’s residence), the United States Circuit Court of Appeals and finally to the United States Supreme Court.

Thus, receiving word from the client that the SNT was rejected by SSA is an EMERGENCY. At that point, you must be ready to advise the client, and to file the appropriate appeal documents. See Forms at Exhibits E and F attached. If you are not going to be representing the client in the appeal, get the client in touch immediately with the SSA attorney you have pre-arranged to handle your appeals. If that is not possible, make absolutely sure the client herself goes to the SSA district office and files the next appropriate level of appeal, and if within the ten days of the denial of benefits notice, also file the request to continue benefits. Remember, you have done the perfect SNT. SSA is wrong, you are right, don’t have the client lose because you missed a deadline.

The SSA Initial Determination, the reported change, and the periodic SSI financial review. As noted above, there are different times when SSA will be reviewing your perfect SNT. SSA is required to do periodic reviews. Those times are listed in 20 CFR § 416.204. Redeterminations of SSI eligibility.


We’ve mentioned the initial determination when a client not formerly on SSI applies for the first time with a trust or when the client’s inheritance or PI award is reported and placed in a d4 SNT. Another time, and the worst, is when SSA receives notice from the IRS that the claimant has reported income from investments.

The IRS reporting is done via computer runs matching SSA’s records of claimants receiving SSI welfare payments. Red flags automatically trigger SSA notices to claimants to come in to explain this source of reported income.

Hopefully that will never occur in one of your cases because you will have reported, and have proof of so doing through certified return receipt mail, which is another reason you and not the client should report your SNT to SSA.

If you report the change of income and resources to the client BEFORE SSA finds out, the color of the case changes dramatically. If it is not reported, and SSA has to find out about it from the IRS first, it is going to be assumed that the non-reporting was intentional, and every discretion will be used against your client and your SNT. If you report first, and timely, SSA will applaud you. The review of whether your trust meets SSI rules will take on a whole different tone.

Second, as a practical matter, you want to report your “perfect SNT” as early as possible because – guess what – everybody makes a mistake, and if you left out something that should have been put in, or put in a clause that should have been left out, what’s the damage. If you reported right away, the damage is X months of loss of benefits – maybe limited to two or three. If instead you didn’t report, and now it is seven years later, the legal malpractice claim is for 84 months times the SSI benefits lost – perhaps $40,000 or more. Better to have a small claim than a large one.

Third, what if you didn’t report the creation and funding that trust you did two or three years ago? Report it now! Report to SSA before IRS does. The SSA staff have the discretion to impose penalties as outlined above, and they will not do so, in my 38 years of experience, if you came to them first. It will come out eventually. And if there’s a mistake, the damages are still less at the two or three year mark, than at seven, eight or more.

Fourth, SSA is (illegally) taking the position that the new POMS they have issued in 2010, 2011 and 2012 can be applied retroactively – even to trusts they have already approved, or as they call it, exempted from counting as a resource. There are rules against ex post facto POMS that apparently Eric Skidmore and the national SSI office staff have forgotten. The difference in treatment of previously reported versus never-reported SNTs is that with a previously reported and “exempted trust,” any new POMS trust rule that SSA publishes must allow for a 90-day “amendment period” for the claimant to revise her trust to make it comply with the newly published rule.

POMS SI 01120.199 Early Termination Provisions and Trusts

A. How to determine when to apply the policies in this section

1. New trusts and trusts that have not been previously excepted under section 1917(d)(4)(A) or (C) of the Act

A trust that is either newly formed or not previously excepted from resource counting must meet all of the criteria set forth in SI 01120.199 through SI 01120.203 and SI 01120.225 through SI


01120.227 to be excepted under section 1917(d)(4)(A) or (C). Do not except such a trust from resource counting unless the trust meets all of these requirements.

2. Trusts that previously met the requirements to be excepted under section 1917(d)(4)(A) or (C) of the Act

A trust that was previously determined to be exempt from resource counting under section 1917(d)(4)(A) or (C) shall continue to be excepted from resource counting, provided the trust is amended to conform with the requirements of this section within 90 days. That 90‐day period begins on the day the recipient or representative payee is informed that the trust contains provisions that must be amended in order to continue qualifying for the exception under section 1917(d)(4)(A) or (C).

Do not count a previously exempted trust as a resource during the 90‐day amendment period. If the trust still fails to meet the requirements of this section after the expiration of the 90‐day amendment period, begin counting the trust as a resource under normal resource counting rules.

NOTE: Each previously excepted trust is permitted only one 90‐day amendment period.

… [the POMS goes on to explain what early termination clauses must contain]…

Whether SSA can impose new rules retroactively is a legal issue. One of the tools against them is their own rule on “change of policy” published at GN 04001.100 Re-openings – Change in Ruling or Legal Interpretation – Change of Position.

For example, there is a specific Regional Chief Counsel Precedent (legal opinion published in the POMS) that a Null and Void Clause would save a defective trust in some circumstances. Subsequent to publishing that rule, Eric Skidmore at SSA’s national office issued the new POMS on Null and Void Clauses found at SI 01120.227 which is directly the opposite.

Therefore, in an SSA appeal where perhaps the 90-day amendment period has already passed, it would be wise to use the SSA rule on “Change of Position” in the GN section quoted above, against the Social Security Administration, an argument that will probably work better at the ALJ Hearing level than at the Reconsideration level for the reasons that will be explained below.

The statutory and procedural requirements for representing your client before the agency. The Social Security Administration takes great steps, backed up by scary law, to ensure that attorneys do not take advantage of the clients they are representing before the agency. No attorney may charge or collect a fee unless SSA approves it through one of two alternative processes: the fee petition process or the fee agreement process. Collecting a fee from the client without SSA approval is a criminal offense and can lead to disbarment from practicing before the Social Security Administration, and if state bar rules require notification of other agency’s or state’s actions, potential disbarment from the state bar.

Fee petition process. With a fee petition process, the attorney submits a petition for approval of the fee at the conclusion of the matter on a form provided by the government. The fee petition is submitted to the official at the level at which the claim was approved. If at Reconsideration, to the local SSA staff; if at the conclusion of a successful ALJ appeal, to the Administrative Law Judge; and if at the Appeals Council level, then to the Appeals Council. A copy of the Form is attached as Exhibit N. The attorney can ask the client to deposit an amount for the anticipated fee in the attorney’s trust account, and held until SSA determines the amount of the fee. Any amount not approved must be returned to the client.


Fee agreement process. As an alternative, the attorney could agree to execute a contract to represent the client on a contingent fee basis of 25% of the past due benefits, potentially capped at a fee of $6,000 if successful (there are exceptions). This eliminates the requirement to keep hours and submit a detailed fee petition, but only works if the client has funds due her at the conclusion of the case. If the client has elected to have benefits continue during the pendency of the matter, there will be no “retroactive award” from which to calculate a 25% fee, and as the math usually works out, 25% of zero is zero fee to the attorney.

Collecting a fee from the Trustee. If it is a first party d4 SNT, collecting a fee from the trustee is forbidden unless approved by the Social Security Administration. Collecting a fee from the trustee of a third party SNT may not be. Similarly, collecting a fee from a guardianship which has been approved by the guardianship court judge may avoid having the fee approved by the Social Security Administration.

Notifying SSA of your representation. SSA rules require notification on Form 1696, Appointment of Representative. A copy of Form 1696 is attached as Exhibit O. Additional forms for direct payment of the fee, and IRS tax notification are also required. See Form 1695 attached as Exhibit P.

First steps in the appeal – responding to requests for information. The initial inquiry by SSA of an unreported source of income begins with a request to the claimant that they need to appear in the local office to explain it. Failure to respond and fully cooperate with SSA will result in immediate termination of benefits for failure to cooperate:

20 CFR §416.714. When reports are due….

(b) We request a report. We may request a report from you if we need information to determine continuing eligibility or the correct amount of your SSI benefit payments. If you do not report within 30 days of our written request, we may determine that you are ineligible to receive SSI benefits. We will suspend your benefits effective with the month following the month in which we determine that you are ineligible to receive SSI benefits because of your failure to give us necessary information. [emphasis added]

More specific powers with regard to finances are granted to SSA by the claimant when the person applies for SSI disability benefits. Although they may not realize it, the claimant has authorized SSA to get information directly from financial institutions. This anti-fraud measure is what our firm uses to advise banks when the trust department receives a request from SSA to release banking information and the claimant, perhaps because of the mental impairment itself, refuses to give the bank authority to respond. It is the trustee’s obligation to protect the claimant, and one interpretation is to assist the claimant in maintaining benefits by promptly reporting.

20 CFR §416.207. You do not give us permission to contact financial institutions.

(a) To be eligible for SSI payments you must give us permission to contact any financial institution and request any financial records that financial institution may have about you. You must give us this permission when you apply for SSI payments or when we ask for it at a later time. You must also provide us with permission from anyone whose income and resources we consider as being available to you, i.e., deemors (see §§ 416.1160, 416.1202, 416.1203, and 416.1204)….


(d) We may ask any financial institution for information on any financial account concerning you. We may also ask for information on any financial accounts for anyone whose income and resources we consider as being available to you (see §§ 416.1160, 416.1202, 416.1203, and 416.1204)….

(g) If you don't give us permission to contact any financial institution and request any financial records about you when we think it is necessary to determine your SSI eligibility or payment amount, or if you cancel the permission, you cannot be eligible for SSI payments….

Once SSA has the information and mistakenly determines that your perfect SNT isn’t, a Notice of Determination will be issued advising the client that she has 65 days to appeal, and in small print for those already receiving benefits, that appealing within ten days will continue the benefits.

Request for Reconsideration. Assuming you are representing the claimant in the appeal, the next step is to file the Request for Reconsideration. A copy of the blank form is found in Exhibit E. Don’t forget to file the request that benefits continue pending the appeal if within the ten day period. A copy of a filled out Request for Reconsideration is attached in Exhibit G. The striking thing about the filled out form is that we have circled, numerous times, the request that the Reconsideration not be done by “Case Review” but by Informal Conference. [The Formal Conference procedure is not available in non-medical cases], Case review will result in the immediate issuance of a denial of the Reconsideration without a chance to discuss the matter with local staff. An Informal Conference requires that SSA cannot issue a denial without a face-to-face conference in the local office. Always request an Informal Conference.

PRACTICE TIP. Why do we so blatantly circle the box that the Reconsideration be by “Informal Conference”? Because SSA processes thousands of requests for reconsideration daily. In a medical eligibility case, our firm like virtually all firms in the country never requests an in-person conference. The local district office staff are not the people making the medical eligibility determinations and are powerless to reverse it. The local staff, however, do issue Recon decisions on the non-medical issues all the time, and 99% of people requesting reconsideration do so asking for “case review” which gets them a one-day turn-around, “Hey, we told you we were right the first time.” Since we really want to see the staff analysis of why the SNT is allegedly defective, and have the opportunity to have the decision reversed in just a few weeks or months rather than a year or more waiting for an ALJ hearing, we need the staff to have to set up a conference and give us the information. It is to avoid simple automaton error – “See Request for Recon, process it as a Case Review” which they do in 99% of the cases. So SCREAM (in circled writing) that this case is different, we want an in-person conference.

The rules for a reconsideration conference. SSA has published a set of rules for Reconsideration conferences found in the POMS. Because they are important, a set is attached as Exhibit H. The federal regulations on Recon conferences are:


20 CFR§ 416.1413. Reconsideration procedures.

If you request reconsideration, we will give you a chance to present your case. How you can present your case depends upon the issue involved and whether you are asking us to reconsider an initial determination on an application or an initial determination on a suspension, reduction or termination of benefits. The methods of reconsideration include the following:

(a) Case review. We will give you and the other parties to the reconsideration an opportunity to review the evidence in our files and then to present oral and written evidence to us. We will then make a decision based on all of this evidence. The official who reviews the case will make the reconsidered determination.

(b) Informal conference. In addition to following the procedures of a case review, an informal conference allows you and the other parties to the reconsideration an opportunity to present witnesses. A summary record of this proceeding will become part of the case record. The official who conducts the informal conference will make the reconsidered determination.

Who will be there. The claimant, her attorney, and a SSA Claims Rep acting as the hearing officer will be there. The District Manager may sit in, or may actually run the conference (better yet – they usually have more experience).

What will happen. The claimant and her attorney have the right to examine the evidence offered against the perfect trust. In reality, that may not happen. Our firm has had wonderful experience with Recon conferences, and a terrible experience or two.

Why? Because before issuing the initial determination of your perfect SNT, some SSA district office staff have referred the trust to the SSA Regional Office for review. Perhaps it has been reviewed by the Regional Chief Counsel or his or her staff attorneys. If it’s the latter, SSA may take the position that the communications to the local SSA staff stating why it is believed that your perfect SNT is defective will be regarded as privileged attorney-client communications.

Try to get the local SSA staff to get the Regional Chief Counsel staff on the telephone during the conference to iron this out. The purpose of the Recon conference is for you to understand why they believe the trust is defective (which will NOT appear in the initial notice) and for you to have an opportunity to explain why SSA’s position is incorrect.

If that is not possible, ask for a continuance of the Recon conference until you get an interpretation/ruling from the Regional Chief Counsel that you have a right to see the evidence (usually an email from the Regional Office to the local SSA staff) that explains why the trust is allegedly defective.

You should prepare and bring to the Recon conference an analysis of your trust and why it meets the Eight Step-Action Chart requirements of POMS SI 01120.203, or if it is a Third Party SNT, where it contains the three minimum rules for a passable TP-SNT found in POMS SI 01120.200. A form which we use to respond to SSA for d4A individual trusts is attached as Exhibit I. Any form of written argument that you think is persuasive is acceptable. There is no requirement that you produce anything in writing but it would be bad practice to miss the opportunity.


When will the conference be scheduled. There is what the rules suggest and what really happens. Here’s the rules:

20 CFR §416.1413c. Arrangement for conferences.

(a) As soon as we receive a request for a formal or informal conference, we shall set the time, date and place for the conference.

(b) We shall send you and any other parties to the reconsideration a written notice about the conference (either by mailing it to your last known address or by personally serving you with it) at least 10 days before the conference. However, we may hold the conference sooner if we all agree. We will not send written notice of the time, date, and place of the conference if you waive your right to receive it.

(c) We shall schedule the conference within 15 days after you request it, but, at our discretion or at your request, we will delay the conference if we think the delay will ensure that the conference is conducted efficiently and properly.

(d) We shall hold the conference at one of our offices, by telephone or in person, whichever you prefer. We will hold the conference elsewhere in person if you show circumstances that make this arrangement reasonably necessary.

In our experience, Reconsiderations conferences are routinely not set up for many weeks or several months. Calendar two months. If the conference is not set by that time, start contacting the local SSA office to inquire. Be nice. The person you yell at could be the one deciding your Recon appeal.

The procedures for running the conference are laid out in detail in Exhibit H. Usually you will know at the conclusion of the Recon conference whether you have convinced the hearing officer of the perfection of your perfect SNT. A formal written Notice of Reconsideration will be issued in writing revealing the good or bad news.

If the worst occurs and your SNT has defects, or SSA believes it has defects and you can amend with adversely affecting the viability of the client’s SNT, amend the trust, re-submit to SSA, and hopefully receive a favorable determination. If you discover the error at the Recon conference itself, ask for a continuance to correct the error so that your client does not have to file a new SSI application.

Request for Hearing. The Notice of Reconsideration will state that if you disagree, you have the right to request a hearing before an Administrative Law Judge. The Form for doing that is attached as Exhibit J. Since 99%+ of cases appealed are medical, SSA staff will be looking for a host of medical disability documents that must accompany a Request for Hearing. Again, to prevent human error, we boldly advise that “this is a financial appeal and we are not submitting Medical Release forms, the Disability Report, or other forms not required in an SSI financial eligibility issue only” or word to that effect.

When will the hearing occur. The attorney will have plenty of time to prepare for the hearing. Filing a Request for Hearing gets a claimant in line for a hearing at the Office of Disability Adjudication and Review (ODAR). Under George Bush, the wait for a hearing increased to almost three years and a backlog of one million cases occurred. Obama has re-staffed the ALJ positions, and despite a larger number of applications than usual due to the lay


off of disabled workers seeking to get back on benefits, the wait is shortened substantially. As of November 2012, some average hearing wait times are:

Texas and Louisiana – 8.6 months Arkansas – 9 months Oklahoma – 11 months Colorado – 12 months New Mexico – 14 months For the Dallas North ODAR – 11.4 months (355 days) – which is also the national hearing wait time. The fastest Texas ODAR is Houston North – 8 months (274 days).

This is the time from filing the Request for Hearing to having a hearing, not from the initial determination, and also not from the time the Administrative Law Judge actually issues the operative favorable or unfavorable decision. Therefore, one can see why it is important to try to win at the local SSA district office at Recon.

In most ODARs, the appeal will not be assigned to a particular ALJ until a month or two before it is set for a hearing. Clients will ask whether you can set the hearing, as is routinely done in many civil and criminal courts. Unfortunately that is not one of the powers of the client, nor the client’s attorney. The SSA computer and an ODAR scheduling clerk, together with the particular ALJ assigned the case, will determine when the case is to be heard.

Where will the hearing occur. States usually have multiple ODAR offices responsible for a particular geographic area in that state. For example, in Texas, there are hearing offices in seven cities:

Office Judges

Avg. Hearing Wait Time

Average Processing Time

Avg. Dispositions Per Day Per ALJ

Cases Dismissed

Cases Approved

Cases Denied

Dallas Downtown 13 11.0 months 355 days 2.3 18% 46% 37%

Dallas North 19 9.0 months 314 days 2.2 20% 39% 41%

Fort Worth 9 8.0 months 300 days 2.4 17% 35% 48%

Houston North 10 8.0 months 274 days 2.6 21% 36% 43%

Houston-Bissonnet 13 9.0 months 266 days 2.5 28% 29% 43%

Rio Grande Valley Tx 4 7.0 months 255 days 3.1 19% 32% 49%

San Antonio 17 10.0 months 325 days 2.3 17% 42% 41%

All texas 8.6 months 290 days 2.5 20% 38% 42%

Go to the website, www.disabilityjudges.com and click on your state, and then the local “office” listed there, and you will see the names of the judges and their record for paying or denying benefits, and comments about the particular judge’s procedures, demeanor, or other useful information. Unfortunately, under a new procedure instituted in 2011 and 2012, we are not allowed to know the name of the judge before the hearing. You will learn which judge you have on the day of the hearing. Our office takes a print-out of the information on every judge in that particular ODAR unless it is an ODAR where we are totally familiar with each judge.


Outside help? Clients may also want to contact their Congressperson or U.S. Senator, thinking that pressure from them will result in a quicker or more favorable decision. SSA is used to getting these “Congressional Inquiries” and has a whole set of routine responses to issue by computer. Under the separation of powers, the legislative branch cannot interfere in the executive branches determination of eligibility for benefits. The inquiring member of Congress will be told that they will be informed of the decision when it is made, and they are.

Scheduling the hearing. At a minimum, the client and attorney will be advised more than twenty days before the hearing of the time and place for the hearing. Try not to ask for a continuance, as that will put you back in line, albeit at the top. But hearing schedules are usually set 90 days in advance by the judge and the scheduling clerk, so continuing your hearing will cause you to have to wait an additional three months.

Review the ODAR file. Never, ever go to a hearing with reviewing the ODAR file. In medical cases those files are now digitized, and you get a CD with all the medical and procedural records in the file to date. In a non-medical SSI case, however, the files are still processed in paper format. Go to the local ODAR with your identification in hand, and a copy of your 1696 showing your appointment as the attorney representative for the claimant, and ask to see the “Exhibit File” in the case. Read it cover-to-cover. At that point, if you have not seen the SSA staff notes explaining why your perfect SNT isn’t, you will then discover the case for the other side.

What should you submit. Having reviewed the ODAR Exhibit File, it is important to have a written brief arguing why you believe your trust complies with SSA rules. At the ODAR level, it is important to explain up front to the judge in writing, and orally, that there are no federal regulations on Special Needs Trusts, and therefore the POMS control.

The POMS are the only source of detailed guidelines for determining the validity of a Special Needs Trust and its proper administration, In Chevron, USA, Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L.Ed.2d 694 (1984), the U. S. Supreme Court held that in the absence of statutory or regulatory prohibitions, an agency’s interpretations of the applicable statutes shall be given deference. More recently, the Court ruled in Washington State Dept. of Social & Health Services v. Guardianship Estate of Keffeler, 537 U.S. 371, 123 S.Ct. 1017, 154 L.Ed.2d 972 (2003) that Chevron principles apply to the SSA POMS.

Most judges scoff at the POMS and consider them unworthy of a judge’s attention. That works in your favor, however, if your case rests on challenging the POMS as being in violation of the federal Special Needs Trust statute. If your trust does comply with the POMS, then suggest that the Keffeler case indicates that SSA has to follow its own published rules.

The form of your “brief” is unspecified by SSA rules. Anything persuasive and useful is appropriate and can even be in letter format on your letterhead. Our law firm prefers a little more formal presentation that would be appropriate in a civil court appeal.

Procedure at the hearing. Arrive early and again ask for the Exhibit File from the clerk at the front desk. Explain it is a “paper file” since almost all hearings are not these days. Review the file for anything new. Often you will find paperclips or judge’s notes of the random things the judge thinks is relevant. If you client has not reported the trust timely, most certainly the judge will make note of it and hold it against the client. Many times, however, the client has in fact told SSA local office staff, and may even know personally the name of the SSA staff


member. Make a note to have the client testify to that fact, and include it in your opening statement.

Who should be there. You will meet your client in the ODAR waiting room a half hour before the hearing time. Go over the points with the client that you will want the client to testify to at the hearing. If the beneficiary is a cute child in an extra-large handicapped buggy for a ten-year-old, make sure the child is there for the hearing. In child cases, most judges insist on the child’s presence anyway. But if waived, and the child is adorable, don’t miss your opportunity. Judges get tired of seeing old, broken down disabled adults all day long, all week and all month.

What to bring. Make sure you have an extra copy of your brief for the judge, just in case, and a clean copy of the SNT and any amendments to it after its initial execution. Some judges will request to see the personal injury Closing Statement that led to the creation of the d4 SNT, and a complete accounting from beginning to present. Our firm is prepared to provide those at hearing, but only if requested. We don’t want the judge getting confused, which happened in a Florida Panhandle case, between evaluating the SNT as a qualifying document, and reviewing the distributions from the trust in case any of them were disqualifying income. Keep the focus on the language of the trust and the determination of whether it is an exempt resource.

Conduct of the hearing. Obviously, there will be some variation between judges.

My favorites will ask you to come into the hearing room alone, without your client, and will discuss the case off the record in an informal give and take, then tell you to bring in the client and we’ll put certain testimony on the record and close the hearing in fifteen minutes. That kind of conference is going to lead to a favorable decision.

Most judges will have you and clients come in to the small courtroom together. The hearings are closed to the public. If testimony is going to be taken from more than one person, the judge may invoke the rule to have other witnesses wait outside while the claimant testifies first, then bring in the additional witnesses one at a time.

The judge will be sitting at a small judicial bench, and there will be a perpendicular table for you and the clients to sit at. There will be computers in front of you (which are used in medical cases only), and microphones which are making a recording of the proceeding. The judge will have a hearing monitor, an assistant who runs the recording equipment and handles any paperwork for the judge.

You will sit down and remain seated during the hearing, even when you are presenting your opening statement. There will be no attorney for the Social Security Administration, which is a blessing and a curse, because the judge becomes your opposing counsel (ever see two lawyers in a room agree 100% on anything?).

The judge will begin the case by introducing himself or herself, and explain to the claimant that the judge is there to hear their appeal and is not bound by the prior determinations made by SSA to date. If the client does not speak English, SSA will provide an interpreter if you advise them in advance of the hearing. The interpreter will be sworn to accurately interpret and your client will be sworn to tell the truth. If the judge asks the client to stand and be sworn, you stand with your client until the oath is concluded.

Some judges will then ask you to identify yourself as the attorney representative and may ask the client if you are their chosen representative.


The judge will then indicate that various documents were assembled and assigned exhibit numbers, and ask you as the representative if you have any objections to including the exhibits in the official record of the proceedings. It is not appropriate or effective to object to an exhibit, such as the SSA analysis of the record, because it says something you don’t like. Other objections may be valid. Most of the time, no objections are appropriate.

Hopefully, the next thing the judge will do is ask you to give an opening statement. In a non-medical SNT case, our firm regards this as the appropriate time to lay out our oral argument as to the validity of the SNT. Explain the story. The client got a PI award. The client followed the advice of his personal injury attorney and hired you as an expert in Special Needs Trust to prepare a trust that complies with SSA law. Etc. Keep it brief and relevant.

SSA Administrative Law Judges are usually not local to community where they serve. They are recruited and trained nationally, and may serve in various ODARs during their careers. Some work their way through attrition and vacancies and applying for lateral moves to communities that they want to work in over the decades they serve as federal ALJs.

Because they are not “from these parts” necessarily, if any part of your presentation refers to localities, or institutions, personalities, etc., keep in mind the ALJ may have no point of reference or common understanding to that to which you are referring. Almost every judge will have completely read the file and have an understanding of the issues. They may, however, not have a thorough understanding of the relevant POMS. The trick is to explain the POMS in a way that does not reveal the judge’s lack of knowledge in an obvious way.

If after your opening statement the judge feels the need to have testimony from the client, it is customary for the judge to ask questions first, then turn the client over to you for additional questions. Obviously it is important to carefully observe the judge’s face during the questions and answers, make notes of any areas you gleaned may have been confusing the judge, and when it’s your turn, ask your client follow up questions.

When the judge, and you, feel that no more testimony is needed, if any were taken, the judge may indicate that he or she is satisfied, or that the judge has a problem with a particular issue, and an informal colloquy ensues between you and the judge.

Eventually the judge will announce that the decision will be issued in writing and sent to the client, with a copy to you as the attorney representative. Normally decisions are issued in four to six weeks for medical cases. Our experience is that it takes much longer for non-medical decisions, such as those involving Special Needs Trusts, since there is no template or formula for issuing a non-medical decision.

The judge has to issue a written decision either way – in your client’s favor or not – because each side, your client and SSA, has the opportunity to review the decision and appeal. If you win at the ALJ level, the statistical odds of SSA taking “own motion review” of your victory are less than one percent.

Appeals Council Review. If you lose, the next step is to file a Request for Review of Hearing Decision/Order. See the blank form attached as Exhibit L.

The Appeals Council is headquartered in Falls Church, Virginia with additional offices in Baltimore, Maryland and Crystal City, Virginia.


The Appeals Council looks at all requests for review, but it may deny a request if it believes the hearing decision was correct. If the Appeals Council decides to review your case, it will either decide the case itself (an outright reversal of the unfavorable ALJ decision)or return it to an Administrative Law Judge for further review (remanding the case to the same ALJ you had at the ALJ hearing). When the Appeals Council reviews your case it may consider any of the issues considered by the Administrative Law Judge, including those issues that were favorably decided in your case. Therefore, be careful in appealing ALJ decisions that are partially favorable and partially unfavorable. You may lose everything if the Appeals Council decides that even the parts you won were mistakes by the ALJ.

Additional informal or formal briefs may be submitted to the Appeals Council at any time before it issues its final decision. The Appeals Council does not grant oral argument in these cases except in super-exceptional circumstances, and it is difficult to conceive how an ordinary SNT case could fall into that category.

You will receive a copy of the Appeals Council's final action on your case, but it will be a long, long time in coming, much longer than the normally long time in deciding medical disability appeals. Again, the issues are unfamiliar to judges at the Appeals Council and decisions must be crafted after unusual (for them) research.

This is the last step in the administrative process, and constitutes exhaustion of administrative remedies when the appeal is unfavorably decided, triggering your right appeal to the federal court.

If you bring a civil action seeking judicial review of the Social Security Administration's (SSA's) final decision, SSA staff will prepare the record of the claim for filing with the Court. This includes all the documents and evidence SSA relied upon in making the decision or determination.

Federal Court Review. There is a fee for filing a civil action in Federal court. There have been no fees to date for appealing adverse decisions through the administrative process. It is unlikely that a Motion to File In Forma Pauperis will be successful because the client has the wherewithal to pay the court filing fee from the Special Needs Trust.

The federal court appeal is filed by Complaint in the U.S. District Court including as attached Exhibits the ALJ’s decision and the Appeals Council decision, with service on the Commissioner of Social Security as the defendant. An Answer to the Complaint filed by the U. S. Attorney’s office as attorneys for the Commissioner. The Answer will include a transcript of the proceedings before the ALJ and copies of the ALJ and Appeals Council Exhibit file.

Often the case is re-assigned by the designated federal judge to a Magistrate Judge who will request a declaration in writing of your consent to have the Magistrate Judge decide the case, rather than issue a Report and Recommendation to the federal judge. Our office determines the likelihood of a favorable determination from the Magistrate Judge and whether the assigned favorable judge is good or not good for the type of claim we are presenting. If good, we do not agree to having the Magistrate Judge make the final binding determination, and reserve our right


to file Exceptions to the Magistrate Judge’s Report, so that a second round of briefs are often required, but give out client two bites at the apple.

Occasionally, but rarely, we will appeal an adverse federal court decision to the United States Circuit Court of Appeals. When we do, we are usually successful, because the adverse decision was particularly egregious, not because we are the best appellate attorneys in the world.

Another consideration is whether the bad facts of your case will make bad law in your Circuit. An example would be the Eight Circuit’s recent decision on the Center for Special Needs Trust appeal on the over-age 65 pooled trust case.

Conclusion. It is a total of seven procedural steps from the Notice of Planned Action finding your perfect SNT not so perfect, to the United States Supreme Court.

Because time limits to perfect an appeal are short, deciding now if this kind of attorney work is your cup of tea, and if not, determining in advance, which attorney who practices Social Security law would be best for you to work with. Because SSA rules and procedures are the same around the country, the attorney you select does not have to be one from your city.

But even if you are not going to handle the appeal itself, knowing and acting on the procedural steps to take on an emergency basis is critical.

The best way to win the appeal, as we have emphasized, is to not need to appeal at all by following the SSA published rules for what constitutes a perfect d4 self-settled SNT or a third party SNT, and making sure that SSA is informed of the creation and funding of the trust at the appropriate time.

ATTACHMENTS – 16 Exhibits, 53 Pages

Exhibit A Matrix

Exhibit B SSI spotlight on Trusts

Exhibit C Eight step‐action charts for d4 Special Needs Trusts

Exhibit D SSA Appeals Procedure Flowchart

Exhibit E Request for Reconsideration (blank)

Exhibit F Request that benefits continue pending appeal

Exhibit G Request for Reconsideration (filled in)

Exhibit H Reconsideration Conference POMS

Exhibit I SNT Evaluation forms

Exhibit J Request for Hearing (blank)

Exhibit K Request for Hearing (filled in)


Exhibit L Request for Review of Hearing Decision/Order (by Appeals Council)

Exhibit M POMS SI 02301.310 GK payments continue pending appeals

Exhibit N Fee Petition Form

Exhibit O Form 1696 Appointment of Representative

Exhibit P Form 1695 for Direct Payment of fee

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Lillesand – SSI Update on Attorney’s Fees – Page 1

Attorney’sFeesandSSAFeeApprovalinSpecialNeedsTrustCases

David Lillesand – www.LillesandLaw.com

TableofContents

The issue ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 2

The statutory language ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 2

The relevant attorney fee regulations ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 3

Applying the fee regulation to special needs trust law practice ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 3

A most troublesome SSA Ruling ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 4

The POMS on attorney’s fees ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 5

Are advice only conferences safe from regulation ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 6

ATTACHMENTS

20 CFR §416.1520 Fee for a representative’s services ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 7

POMS GN 03920.005 Representative’s Fees Subject to SSA’s Authorization ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 8

POMS GN 03920.010 Representative’s Fees Not Subject to SSA’s Authorization ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 9

SSR 65‐33c: Section 206.—Representation of Claimant—Fee for Services—Violation ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 13

Form SSA 1696 – Appointment of Representative (including box to waive fee from client) ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ 16


Attorney’sFeesandSSAFeeApprovalinSpecialNeedsTrustCases

David Lillesand – www.LillesandLaw.com

The issue. I’ve been saying publicly and privately for many years, that the general Social Security

Administration (SSA) rule that no attorney may charge a fee for representing an SSI claimant “before the

agency,” means that unless you file a Notice of Appointment of Representative (SSA Form 1696)

requiring the agency to deal with you as the representative, you do not need to have SSA approve your

fee for preparing or defending the Special Needs Trust before you charge and collect the fee from your

client.

I am no longer confident that my former position is correct in all circumstances. I was

encouraged to re‐examine the issue because of statements in Section 747 of Tom Bush’s excellent 2013

publication, “Social Security Disability Practice,” wherein he states:

Do the fee-setting regulations apply if an attorney provides “services” in connection with a pending claim but the attorney is not officially appointed as a “representative” pursuant to 20 C.F.R. § 404.1707? [For SSI cases, the same regulation is found at 20 C.F.R. §416.1520] For example, can you counsel a claimant in an overpayment case and avoid the operation of the fee-setting regulations by never being appointed as the representative? Some attorneys have been known to argue that unless they are appointed as a representative, the fee-setting regulations do not apply. They point out that only appointed representatives are required to file fee petitions under 20 C.F.R. § 404.1720(b).

I no longer think the answer is definitely yes, or definitely no, in part because of the conflicting

language in the statute versus the regulations versus the POMS. As Mr. Bush states: “This controversy illustrates yet another example of the poor quality draftsmanship in the attorney fee regulations. Because penalties are involved, caution is appropriate.”

Therefore, we will review the specific language of the federal statute, the attorney fee

regulations, the POMS and a most troubling Social Security Ruling that was issued 48 years ago, but

which the Social Security Administration still publishes as a policy interpretation of the agency. Finally,

we recommend that if in your opinion the fee for your activities representing your client are not

regulated by the statute, regulation, POMS or the Ruling, that you submit the required notification

waiving the collection of fees or costs from the SSI claimant, and that you will be charging another entity

(the third party or first party trust) or the law firm handling the personal injury or probate action (if the

claimant is about to receive an inheritance).

The statutory language. The Social Security Act at 42 U.S.C. § 406, provides in relevant part:

"* * * The Secretary may, by rule and regulation, prescribe the maximum fees which may be charged for services performed in connection with any claim before the Secretary under this subchapter, and any agreement in violation of such rules and regulations shall be void. Any person who shall * * * knowingly charge or collect directly or indirectly any fee in excess of the maximum fee, or make any agreement directly or indirectly to


charge or collect any fee in excess of the maximum fee, prescribed by the Secretary shall be deemed guilty of a misdemeanor * * *".

The relevant attorney fee regulations. The regulation, 20 CFR §416.1520 directs in

subparagraph (a) that “A representative may charge and receive a fee for his or her services as a

representative only as provided in paragraph (b) of this section” and subsection (b) states:

(b) Charging and receiving a fee.

(1) The representative must file a written request with us before he or she may charge or receive a fee for his or her services.

(2) We decide the amount of the fee, if any, a representative may charge or receive.

(3) Subject to paragraph (e) of this section, a representative must not charge or receive any fee unless we have authorized it, and a representative must not charge or receive any fee that is more than the amount we authorize.

Subsection (e) then lays out the circumstances under which SSA does not require approval of

our fees before they are collected from the claimant:

(e) When we do not need to authorize a fee. We do not need to authorize a fee when:

(1) An entity or a Federal, State, county, or city government agency pays from its funds the representative fees and expenses and both of the following conditions apply:

(i) You are not liable to pay a fee or any expenses, or any part thereof, directly or indirectly, to the representative or someone else; and

(ii) The representative submits to us a writing in the form and manner we prescribe waiving the right to charge and collect a fee and any expenses from you directly or indirectly, in whole or in part; or

(2) A court authorizes a fee for your representative based on the representative's actions as your legal guardian or a court-appointed representative.

Applying the fee regulation to special needs trust law practice. When the regulations use the

word “you” they mean the SSI claimant. Applying the regulation to the special needs practice,

particularly in defending, modifying or reforming Special Needs Trust already in existence, it is clear that

in a first party SNT under 42 U.S.C. §1396p(d)(4)(A), the “entity” being provided the services here is not

usually the bank as trustee, but the beneficiary of the John Smith Irrevocable Special Needs Trust. The

funds in the d4A SNT are whose? I would submit, they belong to “you” the SSI claimant. Collecting from

the SSI claimant’s funds in the trust, money which equitably belongs to him or her, is charging “directly

or indirectly” fees and costs. And thus, we cannot provide services without getting fee approval by SSA.

In the Third Party SNT situation, however, the funds do not belong to “you” the SSI claimant,

and therefore, fees and costs can be can be paid by the trustee from the third party trust fund.


Likewise, in the rare case that the bank trustee employs the attorney, and agrees to pay the

attorney not from the client’s funds in the trust, but from the bank’s own funds without charging back to

the d4A trust fund, there is no need to seek and secure SSA fee approval.

However, even in cases where the payment is coming from funds other than the SSI beneficiary,

subsection (e)(1)(i) requires that the attorney representative “submits to us a writing in the form and

manner we prescribe waiving the right to charge and collect a fee and any expenses.” Such form is the

SSA 1696 form attached here, with the box checked waiving the right to collect fees and costs from the

claimant.

Subsection (e)(2) also provides that that if you represent a claimant before SSA and a court

authorizes your fee as a legal guardian or court‐appointed representative, you do not need to seek

approval of your fee from SSA.

The Most Troublesome SSA Ruling. “Rulings” are a collection of SSA policy statements which

are frequently issued when new policies are announced, interpretations of new statutes so require, or

when court’s issue important decisions which is most of the case, also a decision with which SSA

wholeheartedly agrees.

Such is the case with a 48‐year‐old ruling, SSR 65‐33c, involving a hapless accountant who

prepared fraudulent self‐employment tax returns to help clients establish eligibility for Social Security

benefits. The ruling adopted in toto the court’s opinion in United States v. Lewis, 235 F. Supp. 220 (E.D.

Tenn 1964). She was a tax preparer. She never represented the claimants “before the agency” in any

proceedings. The effect of her work, however, was that the clients were granted quarters of coverage

for work they never performed which would qualify them for disability or retirement benefits under

Title 2 of the Act.

The relevant part of the court’s opinion should be read with the thought in mind of substituting

“trust” for the word ”tax” in the opinion, which makes it a whole lot scarier:

Under the record in this case there was evidence from which a jury could conclude on each count that the tax work performed by the defendant Lewis was in fact a service knowingly performed in connection with a claim before the Social Security Administration. In each instance there was evidence that (a) the applicant initially came to or was referred to the defendant for assistance in making a social security claim, (b) application was made for social security benefits immediately before or after the tax work was performed, (c) the tax returns filed were delinquent returns and reflected only delinquent self-employment tax which would have the effect of establishing social security eligibility, and (d) even though the defendant contended no charge was made for additional services, but only for the tax work, in most instances the defendant performed additional services in connection with the claim before the Social Security Administration. The Court is therefore of the opinion that under the record in this case a jury issue existed under Counts 3, 4, 5, and 6 as to whether the fee charged by the defendant was one subject to regulation under 42 U.S.C. § 406.


The best argument for distinguishing the Lewis case from our work on trust issues is that what

we are doing is NOT fraudulent but specifically allowed under the statutes and SSA POMS. However, on

the other hand, the criminal count against the accountant was not for violating IRS rules by filing

fraudulent tax returns, but in these criminal counts at least, for violating the Social Security attorney’s

fees provisions of the Act – failure to have the fee approved. Read in this light, it is not so clear that

Lewis would not apply to our work as trust drafters.

Paraphrasing the court’s analysis in Lewis, we could say that:

The SSI client initially came to or was referred to the defendant Elder Law Special Needs Attorney for assistance in making an SSI claim, (b) application was made for continuing SSI benefits immediately after the trust work was performed, (c) the Special Needs Trust that was filed would have the effect of establishing SSI eligibility, and (d) even though the defendant Special Needs Attorney contended no charge was made for additional services before the agency, but only for the Special Needs Trust work, in most instances the defendant performed additional services in connection with the claim before the Social Security Administration by submitting the Trust Agreement to SSA for its review.

The POMS on Attorney’s Fees. As Tom Bush states, “Nevertheless, SSA’s policy is that an SSA fee authorization is required “irrespective of whether” the attorney “was ever recognized by SSA as a claimant’s representative, or the individual did not deal directly with or actually contact SSA” citing POMS GN 03920.005B.

There are two POMS on attorney’s fees of relevance here: 1) GN 03920.005 Representative's

Fees Subject to SSA's Authorization, and 2) GN 03920.010 Representative's Fees Not Subject to Social

Security Administration's (SSA) Authorization (emphasis added).

Paragraph B of GN 03920.005 states that:

A representative, attorney or non-attorney, must obtain SSA's authorization to charge and collect a fee for services provided in proceedings before SSA irrespective of whether (among other things):

the services result in an allowance, reinstatement, or disallowance action by SSA;

the attorney/non-attorney was ever recognized by SSA as a claimant's representative, or the individual did not deal directly with or actually contact SSA; or

the fee is charged to or collected from the claimant or a third party (e.g., an insurance company), unless the requirements in GN 03920.010B. are met.

The second POMS, GN 03920.010, parrots the language of the regulations cited above, but goes

further in defining some terms, including what may be considered a “third party entity” in Subsection

such as a trust:


A third-party entity is a business, firm, or other association, including but not limited to partnerships, corporations, for-profit or nonprofit organizations, or a government agency. As used in this section, a third-party entity provides a claimant with representation and pays the representative’s fee and expenses without passing any financial liability to the claimant or any auxiliary beneficiaries.

The important phrase for trust purposes is “without passing any financial liability to the

claimant.” Clearly in a d4A self‐settled First Party SNT, charging the client’s trust is passing financial

liability to him or her since the trust is composed by definition of funds belonging to the claimant, and

the client has an equitable interest in the trust funds and could sue if someone stole them. Again it

appears to me that charging fees and costs to a third party trust is probably not a problem, but charging

them to a first party trust is more so.

It appears that “advice only” conferences may be safe from the attorney fee regulations.

Suppose the client comes to you with a small inheritance or personal injury award. Instead of preparing

a Special Needs Trust, you spend office conference time developing a “spend down plan” – a plan to use

the limited funds to buy a new car, repair the house, pay down a mortgage, etc., and you do not “take

the case” beyond the conference. Tom Bush refers to a curious exception that may allow such advice

and payment by the client without fee approval:

If a claimant doesn’t appoint you as a representative and you do not perform what SSA regards to be “services” in connection with a claim, you may charge a fee without first getting it approved by SSA. The only example of this appears in an SSA opinion letter which was sent to NOSSCR. SSA approved the practice of some attorneys who charge a fee for evaluating a case but ultimately decide not to represent the claimant. Such attorneys request money from the claimant at the initial interview. If the attorney accepts the case for representation, the money is put into a trust account to be used for payment of expenses in the claimant’s case. If the attorney evaluates the case and decides to decline representation, the payment is accepted for case evaluation, something which SSA has said is not “services.” Contact NOSSCR [www.nosscr.org] for a copy of the SSA opinion letter.

Conclusion. This is one of those situations where there is no definitive law, one way or the

other. Each of us will have to make our own assessment of the conflicting statute, regulations, POMS and Rulings. It is even difficult to derive a over‐arching principle or general approach that can be used as a guide.

To help you in making up your own mind, this presentation has outlined the parameters, and on the following pages gives you the original documents to review.

It’s all going to come down to your own comfort level to seek or not seek approval of your attorney’s fees from the Social Security Administration. Given the agency’s internally conflicting views and the many decades some of these positions have been out there, it is unlikely that relief through a definitive regulation will come any time soon, if ever.


20 CFR § 416.1520. Fee for a representative's services.

(a) General. A representative may charge and receive a fee for his or her services as a representative only as provided in paragraph (b) of this section.

(b) Charging and receiving a fee.

(1) The representative must file a written request with us before he or she may charge or receive a fee for his or her services.

(2) We decide the amount of the fee, if any, a representative may charge or receive.

(3) Subject to paragraph (e) of this section, a representative must not charge or receive any fee unless we have authorized it, and a representative must not charge or receive any fee that is more than the amount we authorize.

(4) If your representative is an attorney or an eligible non-attorney, and you are entitled to past-due benefits, we will pay the authorized fee, or a part of the authorized fee, directly to the attorney or eligible non-attorney out of the past-due benefits, subject to the limitations described in § 416.1530(b)(1). If the representative is a non-attorney who is ineligible to receive direct fee payment, we assume no responsibility for the payment of any fee that we have authorized.

(c) Notice of fee determination. We shall mail to both you and your representative at your last known address a written notice of what we decide about the fee. We shall state in the notice—

(1) The amount of the fee that is authorized;

(2) How we made that decision;

(3) Whether we are responsible for paying the fee from past-due benefits; and

(4) That within 30 days of the date of the notice, either you or your representative may request us to review the fee determination.

(d) Review of fee determination—

(1) Request filed on time. We will review the decision we made about a fee if either you or your representative files a written request for the review at one of our offices within 30 days after the date of the notice of the fee determination. Either you or your representative, whoever requests the review, shall mail a copy of the request to the other person. An authorized official of the Social Security Administration who did not take part in the fee determination being questioned will review the determination. This determination is not subject to further review. The official shall mail a written notice of the decision made on review both to you and to your representative at your last known address.

(2) Request not filed on time.

(i) If you or your representative requests a review of the decision we made about a fee, but does so more than 30 days after the date of the notice of the fee determination, whoever makes the request shall state in writing why it was not filed within the 30-day period. We will review the determination if we decide that there was good cause for not filing the request on time.

(ii) Some examples of good cause follow:

(A) Either you or your representative was seriously ill and the illness prevented you or your representative from contacting us in person or in writing.


(B) There was a death or serious illness in your family or in the family of your representative.

(C) Material records were destroyed by fire or other accidental cause.

(D) We gave you or your representative incorrect or incomplete information about the right to request review.

(E) You or your representative did not timely receive notice of the fee determination.

(F) You or your representative sent the request to another government agency in good faith within the 30-day period, and the request did not reach us until after the period had ended.

(3) Payment of fees. We assume no responsibility for the payment of a fee based on a revised determination if the request for administrative review was not filed on time.

(e) When we do not need to authorize a fee. We do not need to authorize a fee when:

(1) An entity or a Federal, State, county, or city government agency pays from its funds the representative fees and expenses and both of the following conditions apply:

(i) You are not liable to pay a fee or any expenses, or any part thereof, directly or indirectly, to the representative or someone else; and

(ii) The representative submits to us a writing in the form and manner we prescribe waiving the right to charge and collect a fee and any expenses from you directly or indirectly, in whole or in part; or

(2) A court authorizes a fee for your representative based on the representative's actions as your legal guardian or a court-appointed representative.

[45 FR 52106, Aug. 5, 1980, as amended at 72 FR 16725, Apr. 5, 2007; 74 FR 48384, Sept. 23, 2009; 76 FR 45195, July 28, 2011]

GN 03920.005 Representative's Fees Subject to SSA's Authorization

A. Policy - SSA's Authority

The Act directs the Commissioner to authorize the fee an attorney representative (hereinafter we use “attorney”) or non-attorney representative may charge and collect for services provided to a claimant in proceedings before SSA.

B. Policy - Fee Authorization Required

A representative, attorney or non-attorney, must obtain SSA's authorization to charge and collect a fee for services provided in proceedings before SSA irrespective of whether (among other things):


the services result in an allowance, reinstatement, or disallowance action by SSA; the attorney/non-attorney was ever recognized by SSA as a claimant's representative, or

the individual did not deal directly with or actually contact SSA; or the fee is charged to or collected from the claimant or a third party (e.g., an insurance

company), unless the requirements in GN 03920.010B. are met.

C. Policy - Proceedings Before SSA

SSA considers any claim or asserted right under titles II, XVI, or XVIII of the Social Security Act, which results in the following, to be a proceeding before SSA for fee purposes:

an initial, revised, or reconsidered determination or action by a field office or processing center; or

a decision or action by an Administrative Law Judge or an Administrative Appeals Judge, including a decision issued after a court remand.

D. List of Proceedings Before SSA

Proceedings that require SSA's fee authorization include, but are not limited to, services in connection with:

an application for Social Security monthly benefits, supplemental security income (SSI) payments, or a lump-sum death payment;

an application for hospital insurance benefits or supplemental medical insurance benefits; a request to establish or continue a period of disability; a request to modify the amount of benefits; a request to reinstate benefits; a request to waive recovery of an overpayment, or an appeal of an overpayment waiver

denial determination; and a request to revise an earnings record.

GN 03920.010 Representative's Fees Not Subject to Social Security Administration's (SSA) Authorization

A. Definitions


1. Nonprofit organization

A nonprofit organization is one that is exempt from income tax under section 501 or 521 of the Internal Revenue Code, as discussed in RS 01901.540. Generally, most nonprofit organizations considered within the scope of this section are those, which perform, or arrange for the performance of, representative services on behalf of claimants and assume responsibility for the payment of these services at no cost to the claimants.

2. Government agency

Government agency is used in the common sense of the term (i.e., a Federal, State, county, or city agency).

3. Third-party entity

A third-party entity is a business, firm, or other association, including but not limited to partnerships, corporations, for-profit or nonprofit organizations, or a government agency. As used in this section, a third-party entity provides a claimant with representation and pays the representative’s fee and expenses without passing any financial liability to the claimant or any auxiliary beneficiaries.

4. Out-of-pocket expenses

Out-of-pocket expenses are expenses incurred by the representative for which the representative has been paid or expects to be paid. Out-of-pocket expenses include, but are not limited to, the cost of obtaining copies of doctor or hospital reports, birth or death certificates, postage, and photocopying. They do not include paralegal or secretarial services, in-house experts, review of fees, or any share of the representative's overhead or utility costs.

5. Waiver statement

A waiver statement is a written statement a representative submits to document that the representative does not wish for us to withhold past-due benefits for direct fee payment or does not wish to charge or collect a fee. We accept three types of waiver statements:

a. Waiver of direct payment – the representative waives the right to receive direct payment of his or her fees. We will authorize the fee the representative will charge, but we will not withhold any amount from the claimant’s past-due benefits or pay that fee. The representative must collect his or her fee directly from the claimant (see GN 03920.020B.2).

b. Waiver of payment of the fee from a claimant and any auxiliary beneficiaries – the representative relieves the claimant and any auxiliary beneficiary from all liability to pay a fee and any expenses, but may charge and collect the fee from another source. We may not have to authorize this fee if certain specific criteria are met (see GN 03920.010B).


c. Waiver of all fees – the representative will not charge or collect a fee from any source (i.e., the claimant or a third party) for services the representative provided in representing the claimant before us or before a court. This relieves the claimant of all liability to pay a fee and expenses for those services (see GN 03920.020 for waiver procedures).

B. Policy for payment of fee by a third-party entity

1. General provisions of authorization of fees for representatives

A primary purpose of SSA's statutory authority to authorize fees for representation is to protect claimants against unreasonable fees. However, when a third-party entity pays for the representative’s services, the risk of claimants’ liability for unreasonable fees is eliminated. Therefore, when a third-party entity pays the representative’s fees and certain conditions are met, we do not need to authorize the representative’s fee.

2. When we do not need to authorize a fee

Our regulations at 20 C.F.R. §§ 404.1720 and 416.1520 do not require fee authorization by SSA under the following conditions:

The claimant and any auxiliary beneficiaries are free of direct or indirect financial liability to pay a fee or expenses, either in whole or in part, to a representative or to someone else; and

A third-party entity, or a government agency from its own funds, pays the fee and expenses incurred, if any, on behalf of the claimant or any auxiliary beneficiaries; and

The representative submits to SSA a form SSA-1696-U4 (or a written statement) waiving the right to charge and collect a fee and expenses from the claimant and any auxiliary beneficiaries as specified in GN 03920.020B.3.b.

C. Policy for out-of-pocket expenses

We do not authorize out-of-pocket expenses (see examples of out-of-pocket expenses in GN 03920.010A.4). These expenses are a matter for the representative and claimant to settle. However, we will question out-of-pocket expenses if it appears that the representative is attempting to circumvent our fee authorization process by designating his or her services as out-of-pocket expenses or if the alleged out-of-pocket expenses appear unreasonable. If we question out-of-pocket expenses, we may require the representative to provide proof of such expenses.

D. Policy for court proceedings

We do not consider the services in proceedings before state or Federal courts (even if the state court action was to establish relationship or death) to be services provided in connection with proceedings before us; therefore, the fee authorization provisions do not apply to court


proceedings. However, we must still withhold past due benefits for possible direct payment of fees authorized by the court. For information about reimbursement of expenses incurred in the course of court actions (see, Equal Access to Justice Act GN 03990.000).

E. Policy for legal guardian or other state court-appointed representative

A legal guardian, committee, conservator, or other state court-appointed representative (hereinafter “legal guardian”) may ask the court to approve a fee for services provided in connection with proceedings before us. If the court orders a fee, we do not need to authorize that fee.

If a legal guardian asks us for information regarding fees, advise the legal guardian to ask the state court to approve a fee for all services, including those provided in connection with proceedings before us.

If a legal guardian files a fee petition, advise the legal guardian that we do not act on the fee request until the state court has acted. EXCEPTION: If the legal guardian notifies us that the court declined to order a fee on the fee request, advise the legal guardian to file a fee petition for only those services provided in proceedings before us. If the legal guardian files a fee petition, the legal guardian must provide all of the following:

copies of the accounting submitted to the court; copies of the fee request submitted to the court; and the court's decision to not act on the fee request, or any court-ordered fee for services

performed as legal guardian.

F. Policy for Medicare Parts A and B cases

1. Fee agreement process not applicable to Medicare cases

The fee agreement process cannot apply in Medicare-only cases because there are no “past-due benefits” from which to calculate a representative's fee. A successful appeal of a claim for payment or service in Medicare results only in a decision to:

pay a provider or supplier directly for items or services already provided or rendered; reimburse a beneficiary for monies the beneficiary has already paid directly to the

provider or supplier for an item or service; or approve authorization for a request for service.

2. Services below the hearing level for Part B cases

We do not consider services below the hearing level in connection with claims in certain proceedings exclusively before Part B intermediaries or carriers to be services provided in connection with proceedings before us; therefore, the fee authorization provisions do not apply to those services.


3. Fee petition filed by a representative for services provided to the beneficiary

We use the same procedures and regulations to approve a fee petition filed by a Medicare beneficiary's representative (see 20 CFR 404.1720 – CFR 404.1725). However, because there are no past-due benefits in Medicare cases, there are no direct pay provisions for representatives.

4. Fee petition filed by a representative of any party other than the beneficiary

In Medicare cases, we do not authorize a fee for services provided to anyone other than the beneficiary because the Centers for Medicare and Medicaid Services (CMS) considers 20 CFR Part 404, Subparts J and R to apply only to fee petitions filed by the representative of a beneficiary (see 42 CFR 405.701(c) and 42 CFR 405.801(c)).

SSR 65-33c: SECTION 206. -- REPRESENTATION OF CLAIMANT -- FEE FOR SERVICES -- VIOLATION 20 CFR 404.975, 404.976, 404.977, and 404.977a

SSR 65-33c

UNITED STATES OF AMERICA v. LEWIS and HICKS, 235 F. Supp. 220 (1964)

Whether the services performed in the preparation of a self-employment tax return are services performed in connection with a claim before the Secretary for which the charging of a fee would be subject to regulation by the Secretary under section 206 of the Act, depends upon whether the real purpose of determining the self-employment income is to knowingly further a claim then made or to be made before the Social Security Administration.

WILSON, District Judge:

* * * * * *

An issue of law that merits careful consideration is raised upon behalf of the defendant Lewis with respect to her conviction upon Counts 3 thru 6. The defendant is charged in these counts with charging fees in excess of that permitted by law for services to social security applicants in connection with the claim for social security benefits. The defendant contends that such charges


as were made by her were for work performed in the preparation of the subject's income or self-employment tax returns and not for any representation before the Social Security Administration. The defendant further contends that the law does not purport to authorize the Social Security Administration to regulate fees with respect to services performed in the filing of tax returns, including self-employment tax returns, and that charges for such tax services could not constitute a criminal offense.

The difficulty with the defendant's contentions in this respect is twofold. In the first place, a dispute of fact exists under the record in this case whether the fees charged were solely for services in regard to tax work, as testified by the defendant, or whether in fact the fees charged were at least in part for services rendered the social security applicant in other respects in the presentation and processing of his claim before the Social Security Administration. In the second place, it cannot be held as a matter of law that charges for services performed in regard to preparation of self-employment tax returns could not under any circumstances constitute a violation of the law regulating fees charged for services performed in connection with any claim before the Social Security Administration.

The statute here involved, 42 U.S.C. § 406, provides in relevant part:

"* * * The Secretary may, by rule and regulation, prescribe the maximum fees which may be charged for services performed in connection with any claim before the Secretary under this subchapter, and any agreement in violation of such rules and regulations shall be void. Any person who shall * * * knowingly charge or collect directly or indirectly any fee in excess of the maximum fee, or make any agreement directly or indirectly to charge or collect any fee in excess of the maximum fee, prescribed by the Secretary shall be deemed guilty of a misdemeanor * * *".

The regulation governing fees adopted in accordance with the above statute, to the extent that the same is relevant to the present discussion, is as follows:

"The fee that an attorney or other person may charge the claimant for representing him in matters before the social security administration must be approved by the social security administration in all cases except (exceptions not applicable). * * * "

In light of the issue now before the Court, it is apparent that the significant language in the above statute is the phrase "service performed in connection with any claim before the Secretary". The word "services" does not necessarily exclude tax services. Neither does it necessarily include tax services. Rather, such inclusion or exclusion must depend upon the facts of the particular case. Whether a fee charged for preparation of the self-employment tax return would or would not be subject to regulation would depend upon whether, under the facts of the particular case, such service might properly be considered a "service performed in connection with any claim before the Secretary". If the real purpose of determining self-employment income was to knowingly further a claim then made or to be made before the Social Security Administration, such would constitute a "service" the fee for which may be regulated. On the other hand, if there was no evidence that the real purpose of the service performed in the determination of the self-employment income was knowingly performed in furtherance of a claim then made or to be


made before the Social Security Administration, such work would not constitute a service the fee for which was subject to regulation.

Under the record in this case there was evidence from which a jury could conclude on each count that the tax work performed by the defendant Lewis was in fact a service knowingly performed in connection with a claim before the Social Security Administration. In each instance there was evidence that (a) the applicant initially came to or was referred to the defendant for assistance in making a social security claim, (b) application was made for social security benefits immediately before or after the tax work was performed, (c) the tax returns filed were delinquent returns and reflected only delinquent self-employment tax which would have the effect of establishing social security eligibility, and (d) even though the defendant contended no charge was made for additional services, but only for the tax work, in most instances the defendant performed additional services in connection with the claim before the Social Security Administration. The Court is therefore of the opinion that under the record in this case a jury issue existed under Counts 3, 4, 5, and 6 as to whether the fee charged by the defendant was one subject to regulation under 42 U.S.C. § 406.

Having fully considered the defendants' motions for new trial, the Court is of the opinion that the motions should be overruled as to each count thereof.

An order will enter accordingly.

SSA FORM 1696 follows.

COMPLETING THIS FORM TO APPOINT A REPRESENTATIVE

Choosing to be RepresentedYou can choose to have a representative help you when you do business with Social Security. We will work with your representative, just as we would with you. It is important that you select a qualified person because, once appointed, your representative may act for you in most Social Security matters. We give more information, and examples of what a representative may do, in the section titled “Information for Claimants.”

Privacy Act Statement

Collection and Use of Personal Information Sections 206(a) and 1631(d) of the Social Security Act, as amended, authorize us to collect this information. We will use the information you provide on this form to verify your appointment of an individual as your representative and his or her acceptance of the appointment.

Completion of this form is voluntary; however, if you want to use this form to appoint someone to act on your behalf in matters before the Social Security Administration (SSA), then you and that individual must complete the appropriate sections of this form.

We rarely use the information you supply for any purpose other than to verify your appointment of an individual as your representative and his or her acceptance of the appointment. However, we may use it for the administration and integrity of Social Security programs. We may also disclose information to another person or to another agency in accordance with approved routine uses, which include but are not limited to the following:

1. 2. 3. 4.

To enable a third party or an agency to assist Social Security in establishing right to Social Security benefits and/or coverage; To comply with Federal laws requiring the release of information from Social Security records (e.g., to the Government Accountability Office or the Department of Veterans Affairs); To make determinations for eligibility in similar health and income maintenance programs at the Federal, State, and local level; and, To facilitate statistical research, audit, or investigative activities necessary to assure the integrity and improvement of Social Security programs.

We may also use the information you provide in computer matching programs. Matching programs compare our records with records kept by other Federal, state, or local government agencies.

Information from these matching programs can be used to establish or verify a person's eligibility for Federally-funded or administered benefit programs and for repayment of payments or delinquent debts under these programs. A complete list of routine uses for this information is available in our System of Records Notice entitled “Appointed Representative File” (60-0325). The notice, additional information regarding this form, routine uses of information, and our programs and systems are available on-line at www.socialsecurity.gov or at your local Social Security office.With your permission, your representative may designate an associate or other party to request and receive information from your claim file on your representative's behalf.

For more information about this privacy statement and how information you provide to us may be used or disclosed to others please contact any Social Security office.

How to Complete this FormPlease print or type your answers on this form. At the top of the form, provide your full name and your Social Security number. If your claim is based on another person's work and earnings, also provide the “wage earner's” name and Social Security number. If you appoint more than one individual as your representative, you may want to complete a form for each of them.Part I Appointment of RepresentativeGive the name and address of the individual(s) you are appointing. You may appoint an attorney or any other qualified individual to represent you. You also may appoint more than one individual, but please refer to the “Information for Claimants” section “What your Representative(s) May Charge” for more information about payment of fees. You can appoint one or more individuals in a firm, corporation, or other organization as your representative(s), but you may not appoint a law firm, legal aid group, corporation or organization itself.Check the block(s) showing the program(s) under which you have a claim. You may check more than one block. Check:• Title II (RSDI), if your claim concerns retirement,

survivors, or disability insurance benefits.• Title XVI (SSI), if your claim concerns

Supplemental Security Income.• Title XVIII (Medicare Coverage), if your claim

concerns entitlement to Medicare or enrollment in the Supplementary Medical Insurance (SMI) plan.

• Title XVIII (SVB), if your claim concerns entitlement to Special Veterans Benefits.

Form SSA-1696-U4 (03-2011) ef (03-2011) Destroy Prior Editions

Lillesand - SSI Update on Attorney's Fees - Page 16

When you give your permission your representative may designate an associate (e.g. a clerk), or other party or entity (e.g. a copying service) to receive information from your claim file on your representative's behalf for the duration of your claim. If you want to give your representative permission to do that, check the block to authorize this release. If you will have more than one representative, check the appropriate block and give the name of the individual you want to be your main representative. You must sign and date the form. Print or type your address, area code and telephone number. If you are appointing a representative to replace a representative that you discharged or who withdrew his or her representation, you must notify us in writing that the prior appointment has ended.Part II Acceptance of Appointment

Each individual you appoint in Part I should also complete Part II. If the individual is not an attorney, he or she must give his or her name, state that he or she accepts the appointment, and sign the form.

Part III Fee ArrangementTo help in processing benefits and fee payments timely you and your representative should complete this section. Your representative should check a box, sign and date the form. Your representative may choose to receive payment, waive direct payment, or waive payment of the fee altogether. If you and your representative change your arrangement before we decide your claim, you can provide a new or amended form so that we can update our records. If you appoint a second representative or co-counsel who also will not charge a fee, he or she should also complete this part or provide a new form, or if not using the form, give us a separate, written waiver statement. If your representative is not eligible for direct payment, or is an attorney or an eligible non-attorney who waives direct payment, you will be responsible for paying any fee we authorize.

Under certain circumstances, we do not have to authorize the fee. These circumstances include where a Court has awarded a fee based on your representative's actions as a legal guardian or court-appointed representative, or where a business (such as an insurance company), other organization or government agency will pay your representative's fee and you and your beneficiaries have no liability to pay any fees or expenses.

Paperwork Reduction Act Statement - This information collection meets the requirements of 44 U.S.C. § 3507, as amended by Section 2 of the Paperwork Reduction Act of 1995. You do not need to answer these questions unless we display a valid Office of Management and Budget control number. We estimate that it will take about 10 minutes to read the instructions, gather the facts, and answer the questions. SEND THE COMPLETED FORM TO YOUR LOCAL SOCIAL SECURITY OFFICE. The office is listed under U. S. Government agencies in your telephone directory or you may call Social Security at 1-800-772-1213 (TTY 1-800-325-0778). You may send comments on our time estimate above to: SSA, 6401 Security Blvd, Baltimore, MD 21235-6401. Send only comments relating to our time estimate to this address, not the completed form.

References

• 18 U.S.C. §§ 203, 205, and 207; and 42 U.S.C. §§ 406 (a), 1320a-6, and 1383(d)(2)

• 20 CFR §§ 404.1700 et. seq. and 416.1500 et. seq.

• Social Security Rulings 83-27 and 82-39• 26 U.S.C. §§ 6041 and 6045(f)

INFORMATION FOR REPRESENTATIVES

Fees for Representation An attorney or other individual who wants to charge or collect a fee for providing services in connection with a claim before the Social Security Administration (SSA) must generally obtain our prior authorization of the fee for representation. The only exceptions are if:• certain requirements are met and a third-party

entity, such as a business, an insurance carrier, a for profit, or nonprofit organization or a government agency will pay the fee and any expenses from its own funds and the claimant and auxiliary beneficiaries incur no liability, directly or indirectly, for the cost(s); or

• a Federal court awarded a fee based on the representative's activities as the claimant's legal guardian or court-appointed representative;

• a Federal court awarded a fee for representational services provided before the court. In those cases, neither the Federal court nor SSA can authorize a fee for the other.

Obtaining Authorization of a Fee To charge a fee for services, you must use one of two mutually exclusive fee authorization processes. You must file either a fee petition or a fee agreement with us. In either case, you cannot charge more than the fee amount we authorize.

Fee Petition ProcessYou may file a fee petition after you complete your services to the claimant. This written request must describe in detail the amount of time you spent on each service provided and the amount of the fee you are requesting. In order to directly pay you under a fee petition, you must either file a fee petition or notify us within 60 days after we decide the claim of your intent to file a fee petition.

You must give the claimant a copy of the fee petition and each attachment. The claimant may disagree with the information shown by contacting a Social Security office within 20 days of receiving his or her copy of the fee petition. We will consider the reasonable value of the services provided, and send you notice of the amount of the fee you can charge.

Fee Agreement Process

If you and the claimant have a written fee agreement, one of you must give it to us before we decide the claim(s). We usually will approve the agreement if:

• you both signed it;• the fee you agreed on is no more than 25

percent of past-due benefits, or $6,000 (or a higher amount we set and announce in the Federal Register), whichever is less;

• we approve the claim(s); and

• the claim results in past-due benefits.

We will send you a copy of the notice we send the claimant telling him or her the amount of the fee you can charge based on the agreement.

If we do not approve the fee agreement, we will tell you in writing. We also will tell you and the claimant that you must file a fee petition if you wish to charge and collect a fee. After we tell you the amount of the fee you can charge, you or the claimant may ask us in writing to review the authorized fee. If we approved a fee agreement, the person who decided the claim(s) also may ask us to lower the amount. Someone who did not decide the amount of the fee the first time will review and finally decide the amount of the fee.

Collecting a FeeYou may accept money for your fee in advance, as long as you hold it in a trust or escrow account. The claimant never owes you more than the fee we authorize, except for:

• any fee a Federal court allows for your services before it; and

• out-of-pocket expenses you incur or expect to incur, for example, the cost of getting evidence. Our authorization is not needed for such expenses.

If you are not an attorney and you are ineligible to receive direct payment, you must collect the authorized fee from the claimant. If you are interested in becoming eligible to receive direct payment, you can find more information about this on our “Attorneys and Appointed Representatives” website: http://www.ssa.gov/representation/.

If you are an attorney or a non-attorney whom SSA has found eligible to receive direct payment and you register with SSA, as described below, we usually withhold 25 percent of any past-due benefits that result from a favorably decided retirement, survivors, disability insurance, or supplemental security income claim. Once we authorize a fee, we pay you all or part of the fee from the funds withheld. We will also charge you the assessment required by section 206(d) and 1631(d)(2)(C) of the Social Security Act. You cannot charge or collect this expense from the claimant. You will need to collect from the claimant:

• the rest of the fee he or she owes, if the amount of the authorized fee is more than the amount of money we withheld and paid you for the claimant, plus any amount you held for the claimant in a trust or escrow account.

• all of the fee he or she owes, if we did not withhold past-due benefits, (for example, because there are no past-due benefits; you waived direct payment or did not register for direct payment; the claimant discharged you or you withdrew from representing before we issued a favorable decision); or we withheld past-due benefits, but you did not ask us to authorize a fee or tell us that you planned to ask for a fee within 60 days after the date of the notice of award and we released the withheld amount to the claimant.

Registering for Direct Fee PaymentIf you are eligible and want to receive direct payment, you must register with us before we effectuate a favorable decision on the claim. To register, you must submit a Form SSA-1699 (Registration of Individuals and Staff for Appointed Representative Services) once and a Form SSA-1695 (Identifying Information for Possible Direct Payment of Authorized Fees) with each appointment. We will use the information you provide on these forms to issue you a Form 1099-MISC if we pay you aggregate fees of $600 or more in a calendar year. The Internal Revenue Code requires that we do this. For information on the registration process, see our “Attorneys and Appointed Representatives” website http://www.ssa.gov/representation/.

Conflict of Interest and Penalties

If you commit improper acts, you can be suspended or disqualified from representing anyone before SSA. You also can face criminal prosecution. Improper acts include:

• If you are or were an officer or employee of the United States, providing services as a representative in certain

• claims against and other matters affecting the Federal government.

• Knowingly and willingly furnishing false information.

• Charging or collecting an unauthorized fee, or charging or collecting too much for services provided in any claim, including services before a court that made a favorable decision.

References• 18 U.S.C. §§ 203, 205, and 207; and 42 U.S.C. §§ 406

(a), 1320a-6, and 1383(d)(2)• 20 CFR §§ 404.1700 et. seq. and 416.1500 et. seq.• Social Security Rulings 83-27 and 82-39

• 26 U.S.C. §§ 6041 and 6045(f)

( ) -


Social Security Administration Form Approved OMB No. 0960-0527Please read the instructions before completing this form.

Name (Claimant) (Print or Type) Social Security Number

- -Wage Earner (If Different) Social Security Number

- -Part I APPOINTMENT OF REPRESENTATIVEI appoint this person,

(Name and Address)to act as my representative in connection with my claim(s) or asserted right(s) under:

Title II (RSDI)

Title XVI (SSI)

Title XVIII (Medicare Coverage)

Title VIII (SVB)

This person may, entirely in my place, make any request or give any notice; give or draw out evidence or information; get information; and receive any notice in connection with my pending claim(s) or asserted right(s).

I authorize the Social Security Administration to release information about my pending claim(s) or asserted right(s) to designated associates who perform administrative duties (e.g. clerks), partners, and/or parties under contractual arrangements (e.g. copying services) for or with my representative.I appoint, or I now have, more than one representative. My main representative is

(Name of Principal Representative)

Signature (Claimant) Address

Telephone Number (with Area Code) Fax Number (with Area Code)(

(

) - Date

Part II ACCEPTANCE OF APPOINTMENTI, , hereby accept the above appointment. I certify that Ihave not been suspended or prohibited from practice before the Social Security Administration; that I am not disqualified from representing the claimant as a current or former officer or employee of the United States; and that I will not charge or collect any fee for the representation, even if a third party will pay the fee, unless it has been approved in accordance with the laws and rules referred to on the reverse side of the representative's copy of this form. If I decide not to charge or collect a fee for the representation, I will notify the Social Security Administration. (Completion of Part III satisfies this requirement.)Check one: I am an attorney. I am a non-attorney eligible for direct payment under SSA law.

I am a non-attorney not eligible for direct payment.

I am now or have previously been disbarred or suspended from a court or bar to which I was previously admitted to practice as an attorney. YES NOI am now or have previously been disqualified from participating in or appearing before a Federal program or agency.

YES NOI declare under penalty of perjury that I have examined all the information on this form, and on any accompanying statements or forms, and it is true and correct to the best of my knowledge.Signature (Representative) Address

Telephone Number (with Area Code)

( ) - Fax Number (with Area Code)

) - Date

Part III FEE ARRANGEMENT(Select an option, sign and date this section.)

Charging a fee and requesting direct payment of the fee from withheld past-due benefits. (SSA must authorize the fee unless a regulatory exception applies.)Charging a fee but waiving direct payment of the fee from withheld past-due benefits --I do not qualify for or do not request direct payment. (SSA must authorize the fee unless a regulatory exception applies.)Waiving fees and expenses from the claimant and any auxiliary beneficiaries --By checking this block I certify that my fee will be paid by a third-party, and that the claimant and any auxiliary beneficiaries are free of all liability, directly or indirectly, in whole or in part, to pay any fee or expenses to me or anyone as a result of their claim(s) or asserted right(s). (SSA does not need to authorize the fee if a third-party entity or a government agency will pay from its funds the fee and any expenses for this appointment. Do not check this block if a third-party individual will pay the fee.)Waiving fees from any source --I am waiving my right to charge and collect any fee, under sections 206 and 1631(d)(2) of the Social Security Act. I release my client and any auxiliary beneficiaries from any obligations, contractual or otherwise, which may be owed to me for services provided in connection with their claim(s) or asserted right(s).

Signature (Representative) Date

FILE COPY

( ) -







Title II (RSDI)

Title XVI (SSI)


Title VIII (SVB)






(

) - Date







) - Date


Charging a fee and requesting direct payment of the fee from withheld past-due benefits. (SSA must authorize the fee unless a regulatory exception applies.)Charging a fee but waiving direct payment of the fee from withheld past-due benefits —I do not qualify for or do not request direct payment. (SSA must authorize the fee unless a regulatory exception applies.)Waiving fees and expenses from the claimant and any auxiliary beneficiaries —By checking this block I certify that my fee will be paid by a third-party, and that the claimant and any auxiliary beneficiaries are free of all liability, directly or indirectly, in whole or in part, to pay any fee or expenses to me or anyone as a result of their claim(s) or asserted right(s). (SSA does not need to authorize the fee if a third-party entity or a government agency will pay from its funds the fee and any expenses for this appointment. Do not check this block if a third-party individual will pay the fee.)Waiving fees from any source —I am waiving my right to charge and collect any fee, under sections 206 and 1631(d)(2) of the Social Security Act. I release my client and any auxiliary beneficiaries from any obligations, contractual or otherwise, which may be owed to me for services provided in connection with their claim(s) or asserted right(s).


CLAIMANT COPY

INFORMATION FOR CLAIMANTS

We will work directly with your appointed representative unless he or she asks us to work directly with you. Your representative may:

• get information from your claim(s) file;• with your permission, designate associates who perform

administrative duties (e.g. clerks), partners and/or parties under contractual arrangements (e.g., copying services) to receive information from us on his or her behalf (by checking the appropriate block and signing this form, you are providing your permission for your representative to designate such associates, partners, and/or contractual parties);

• give us evidence or information to support your claim;• come with you, or for you, to any interview, conference, or

hearing you have with us;

• request a reconsideration, a hearing, or Appeals Council review; and

• help you and your witnesses prepare for a hearing and question any witnesses.

Also, your representative will receive a copy of the decision(s) we make on your claim(s). We will rely on your representative to tell you about the status of your claim(s), but you still may call or visit us for information.

You and your representative(s) are responsible for giving Social Security accurate information. It is wrong to knowingly and willingly furnish false information. Doing so may result in criminal prosecution.

We usually continue to work with your representative until (1) you notify us in writing that he or she no longer represents you; or (2) your representative tells us that he or she is withdrawing or indicates that his or her services have ended (for example, by filing a fee petition or not pursuing an appeal). We do not continue to work with someone who is suspended or disqualified from representing claimants. We will inform you if we suspend your representative.

What Your Representative(s) May Charge Each representative you appoint can ask for a fee. To charge you a fee for services, your representative must get our authorization if you or another individual will pay the fee. However, as described in “Completing this form to appoint a representative, Part III Fee Arrangement” section of this form, under certain circumstances, we do not have to authorize the representative's fee. To request a fee, your representative must file a fee agreement or a fee petition. In either case, your representative cannot charge you more than the fee amount we authorize. If he or she does, promptly report this to your Social Security office.

Filing A Fee PetitionYour representative may file a fee petition when his or her work on your claim(s) is complete. This written request describes in detail the amount of time your representative spent on each service he or she provided you. The request also gives the amount of the fee the representative wants to charge for these services. Your representative must give you a copy of the fee petition and each attachment. If you disagree with the information shown in the fee petition, contact your Social Security office. Please do this within 20 days of receiving your copy of the petition.

We will review the petition and consider the reasonable value of the services provided. Then we will tell you in writing the amount of the fee we authorize.

Filing A Fee AgreementIf you and your representative have a written fee agreement, one of you must give it to us before we decide your claim(s). We usually will approve the agreement if:

• you both signed it;• the fee you agreed on is no more than 25 percent of past-due

benefits, or $6,000 (or a higher amount we set and announced in the Federal Register), whichever is less;

• we approve your claim(s); and• your claim results in past-due benefits.

We will tell you in writing the amount of the fee your representative can charge based on the agreement. If we do not approve the fee agreement, we will tell you and your representative in writing. If your representative wishes to charge and collect a fee, he or she must file a fee petition. After we tell you the amount of the fee your representative can charge, you or your representative can ask us to look at it again if either or both of you disagree with the amount. If we approved a fee agreement, the person who decided your claim(s) also may ask us to lower the amount. Someone who did not decide the amount of the fee the first time will review and finally decide the amount of the fee.

How Much You Pay You never owe more than the fee we authorize, except for:• any fee a Federal court allows for your representative's services

before it; and• out-of-pocket expenses your representative incurs or expects to

incur, for example, the cost of getting your doctor's or hospital's records. Our authorization is not needed for such expenses.

Your representative may accept money in advance as long as he or she holds it in a trust or escrow account. We usually withhold 25 percent of your past-due benefits to pay toward the fee for you if:

• your retirement, survivors, disability insurance, and/or supplemental security income claim(s) results in past-due benefits;

• your representative is an attorney or a non-attorney whom we have determined to be eligible to receive direct payment of fees; and

• your representative registers with us for direct payment before we effectuate a favorable decision on your claim.

You must pay your representative directly:

• the rest of the fee you owe, if the amount of the authorized fee is more than the money we withheld and paid to your representative for you plus any amount your representative held for you in a trust or escrow account.

• all of the fee you owe, if we did not withhold past-due benefits, (for example, because there are no past-due benefits; your representative waived direct payment, did not register for direct payment, you discharged the representative, or he or she withdrew from representing you, before we issued a favorable decision); or we withheld an amount from your past-due benefits, but your representative did not ask us to authorize a fee or tell us that he or she planned to ask for a fee within 60 days after the date of your notice of award and we released the withheld amount to you

What Your Representative(s) May Do

( ) -







Title II (RSDI)

Title XVI (SSI)


Title VIII (SVB)






(

) - Date







) - Date




REPRESENTATIVE COPY

( ) -







Title II (RSDI)

Title XVI (SSI)


Title VIII (SVB)






(

) - Date







) - Date




ODAR COPY

SSI Appeals - When You Are Right and SSA is Wrong · Lillesand, SSI Appeals for Elder Law...

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