What Receipts Does a Representative Payee Need to Keep?

The U.S. Social Security Administration, Veterans Administration and other federal benefit agencies offer representative payment plans that allow friends or family to manage beneficiaries' checks to ensure that their needs are met. This is a key benefit for individuals unable to handle their own financial matters. If no friends or family are available to serve as representative payees, the agencies seek experienced organizations to fulfill that role, which involves strict record-keeping and accountability.

Representative payees must maintain accurate records of all federal checks received. Beyond bank statements and deposit tickets, the specific amounts and dates should be noted as deposits may contain other checks. Agencies are entitled to request periodic reports, so representative payees also have to provide a detailed accounting of how they spent the funds. This process is akin to the role of a professional accountant who must be detailed and thorough while maintaining the highest ethical standards.

Representative payees are responsible to keep all relevant receipts that show how they spent the beneficiaries' money. This applies to all amounts and purposes. For rent or mortgage payments and other large expenses, copies of canceled checks suffice. Payees may also use debit cards to buy food, clothing and incidental expenses, and should clearly mark the purpose on each receipt. For cash purchases, payees must obtain merchant receipts that indicate the transaction's use.

All applicable federal agencies publish strict guidelines for representative payees. They must spend all funds for the beneficiaries' use. According to the Social Security Administration, checks are properly disbursed if "spent for the beneficiary's current and reasonably foreseeable needs; or saved or invested for the beneficiary, after current needs have been met." As long as they adhere to this standard, payees may also use extra funds to support any legal dependent of the beneficiary, such as a child or spouse, while keeping all receipts. Money from the Supplemental Security Income program — for low-income people and those who are blind, disabled or over age 65 — cannot go toward supporting dependents.

Federal guidelines take into account beneficiaries who are in assisted-living facilities or nursing homes. Even though such places generally take care of meals and basic needs, representative payees must pay for any extra necessary supplies, prescriptions or personal needs. If the beneficiary is not on Medicaid, the payee must also pay all reasonable costs charged by the facility.