Social Security

[serpico]

I get Social Security payments for my children, and I've been told over and over that when the year-end questionnaire comes I should mark that I used it all for their support rather than listing that I saved some of it.  Last year after submitting this form I got a call from SS essentially asking if I was sure this is what I did, and my answer was yes.  This year I got another call and now they are asking for details on how I spent these funds - on the phone she even asked me what my mortgage payment was, for example.  While I'm happy not to have a mortgage payment, I got the feeling that it wasn't the 'right' answer.  I said I would have to compile that list and so I have 30 days to do this.

 

Well.  I really don't know how much of that money goes to my kids' upkeep, because all of our funds get comingled.  Has anyone else dealt with this level of scrutiny?

[trying2breathe]

I haven't been audited yet, or called for that matter but it makes me think that I need to be prepared should it happen.

 

Sorry that you're dealing with this.  My son's SS payments stopped once he graduated from high school, I still get payment for my 17 y/o daughter.  I figure that I use all SS funds and more on her care, it would be a chore to put together some kind of financial proof though. 

 

 

 

 

 

 

[Trying]

I haven't been scrutinized that way but have thought about it.  I was to,d by my accountant that you divide all expenses by the number of people in the home to get what you spend on each child.  If no mortgage you still pay taxes on your home. Electric, heat, cable, phone, cell phone, groceries, clothes, school supplies, car payment, gas, sports and hobbies, healthcare costs including what you contribute for insurance, all of it. 

 

What a pain in the neck to gather all of that!  Good luck and let us know how it goes. 

[NoKindaDancer]

I have not had that level of scrutiny. I have started keeping a spreadsheet spending. All household expenses(as listed by Trying) divided by 3 plus each kids childcare and clothing and whatnot. Vacations too. I typically stop once I reach their annual SS amount out of laziness.

 

Bummer that they have targeted you for audit. Sound like a pain in the ass.

[MikeR]

Someone from the *old* board was audited - it happens now and then. Basically, they are just doing a random check. You likely can show that you paid more than you are getting to take care of your kids without too much difficulty.

 

There are a lot of living and entertainment expenses that qualify. Some are:

 

Rent (you said no mortgage, but your rent also qualifies)

Food (if you charge your groceries, pull out copies of the CC bills and circle the ones from supermarkets)

Utilities - light, heat, water, trash, etc.

 

For the above, you can use a portion of the expenses. If you have 2 kids, you can allocate 1/3 to each (the last third is for you).

 

 

Clothing - same thing if you charged them

Anything for school such as supplies, class trip costs, etc.

Entertainment - sports fees, vacations, etc.

Religious education fees

Medical copays, etc.

Some of your auto expenses (gas, insurance, maintenance) for getting them to the places they need to go - school, doctors, playdates, etc. Not sure how you would allocate this but submit it to SS and see what they say.

 

Basically, anything you spend money on your kids for should qualify. Just get the bills together, circle the amounts that relate to the kids and send it to SS. Usually, their share of rent, food, utilities will cover the lio's share of what they get, if not all of it.

 

Mike

 

[mmg19]

Last year I just marked all was used for kids but was aware that this scrutiny was a possibility.  I started a spreadsheet and followed the same approach that others have mentioned.  Dividing all expenses by 3 put them over the amount they received from SS.  I could not count them as dependents with IRS last year since I did not provide more than half of their support but wondering if that has anything to do with who gets audited.

[luvmy2babies]

I haven't dealt with this either; but I know it is possible.  I have a spreadsheet too that tracks expenses and my bank statements to back it up.  I have 2 children so 2/3 of the expenses like everyone else noted.  Add in clothes/shoes, extracurricular activities, entertainment, the occassional vacation, barbershop/salon visits, summer camp, child care when school is closed, etc, I'm way over. 

 

Now that private school and daycare are behind us I will no longer be claiming them as dependents; but even without those two things I'm still spending way over what they get.  Once you begin to take a look at it, I'd be willing to bet you find the same.

[Lisa]

My stepson is disabled. I've been thru this numerous times. I split all the expenses like rent and utilities. Guess a reasonable number for clothes, shoes, food. Add in a small amt for recreation. The expenses are greater than his benefits. I tell them That's why I have balances on my utilities. Be sure you do spend the money. Good luck. It is scarier on paper than in person if you have an interview

 

[Kealoha]

When I went to apply for the SS benefits they actually cautioned me that it would be good to have spending records for this purpose.

 

I track my spending in the Mint app and can tag categories as kid spending, if anyone is interested in spreadsheet alternatives.

 

Hope things go smoothly for you.

[singinmomo4]

I've never had them audit me.  I hope I never do.  I wonder if income plays a role in who gets audited? 

[Jennica]

This will be my first year having to fill out this information. I have been surfing the web and couldn't really find what I wanted. I found some info here. I thought others might want to read it too.

 

I was happy to have found this. I have not made up a spreadsheet or anything though. Input on anything else would be great.

Serpico mentioned that someone stated to mark that nothing had been saved, is this right? My goal has been to try and save for them for college. I have only been able to here and there but ultimately that is my goal.

[Portside]

Here the deal on saving the SS moneys.

 

Certainly you can save it. BUT, if you do, and report it as saved, the SS Administration can ask you to return the saved amount. Because, their reasoning is, if you could save it, you didn't need it for the children's support.

 

So, my advice is to always report nothing saved. It was all spent on all the items mentioned above. Whether you are putting it aside for college is your own business, not uncle Sam's.

 

Mike

[Captains wife]

This is very insightful - I never knew that SS could have so much say in how we spent our deceased spouse's social security for our kids. I fill out the regular questionnaires but have never been scrutinized more than that. I honestly need all of mine for childcare costs (for his only other caregiver other than me) so I use it for that purpose. I can't imagine there's an issue if you save some one month or two then spend it down the road?

[tybec]

Yes, you spend it all.  Never save or that saved amount  will go back or to another account when they are 18 to access.

 

My tax guy had me do an estimate to use as I get spousal benefits and my son gets his and I work pt. Time.  He researched it as I make a lot compared to others.  He said I needed to justify both allotted amounts plus double to show I needed it but yet still pay a majority or my kid would not be my dependent but the federal government when taxes came. 

 

Not hard to show expenses.  So many extras come up.  T-shirt for band, $25 for bio lab fee.  Camp fee.  New bike as he outgrew the old one.  Sports uniform.  This is all above room, board, transportation.  But yes, they could come look.  Drives me crazy.  My LH paid into it but have to justify getting it now.  Another thread....

 

[Nymets1986]

Is there a limit on how much you can earn as logically I would think this would be treated as child support.  I was the primary breadwinner before my husband passed away.  My kids would qualify for survivor benefits but I know I would not qualify for the ongoing ones as I work FT.

 

I just got the death certificates today and I was going up to our social security office early next week.

[daysofelijah]

You can only earn about $17,000 here in MN or they start taking away $1 for every $2 you earn over the limit on my survivor's benefits. So I've always worked part time to keep it under that for the last five years.

 

I got a new job and will be getting remarried in May, so then I will lose my benefits. I have to go in to SS and see how it will affect my children's benefits though.

[Nymets1986]

I called this morning as I just got the death certificate and the earliest office appointment I could get was early February!!  

[tybec]

There are limits.  It is good to have the meeting.  Your circumstances need to be discussed, your family.

 

I just learned something interesting.  I didn't sell my home, as it fell through as the buyers didn't sell theirs and though they got a bridge loan, got scared.  So, my house is sitting there, and I may rent come Jan. as it is has been empty since Aug., which is not good. 

 

Well, my benefits as survivor are based on earned income.  Renting out my house is not earned income. Wow!  So, I could continue to work part time at new job, keeping it under the approximate net 17,000, get my benefits and make money off of renting.  This whole system of loop holes is crazy. Never did I think I would be thinking out loud of this, be in this situation.  I worked full time since age 21. 

 

Survivor benefits will go away when my son turns 16.  I will get his benefits until he graduates HS, which will be after his 18th birthday. 

 

I may work more and not be able to get the survivor benefits.  But a friend told me, "Why?  It is a gift to work pt time and take care of your son.  Why not?"  Well it was a costly gift, but yes.

 

Will see.  Good luck on finding out what works for you.

[Nymets1986]

Does anyone know if social security backdated as my appointment is not until early February?  I qualify for the one time payment  and my children qualify for survivor benefits but  I do not the survivor caretaker benefits as my income is too high.

[Julester3]

They will pay you your children's SSI benefits from when your spouse died. I didn't even have a death certificate for 90 days so my appointment was in August, over 4 months from when my husband died. I got a big amount by the end of the month.

[MikeR]

Nymets...

 

No, there is no earnings test for you. Your kids get SS survivor's benefits flat out. I was also working full time and well over the limit for personal survivor benefits but my kids got (one is still getting) benefits. Apply right away.

 

Tot he original poster - I know a widower who was "audited" ny SS and he had kept very detailed records of what he s[end on his kids - receipts, etc. He sent a book to them with a listing of all the expenditures, copies of receipts and their comment was "No one has ever done that before". Needless to say, they never asked him again.

 

For your case, just send copies of your recent utility bills, rent payments (that counts as much as a mortgage does!) any credit card statements that show what you bought for the kids, any receipts you might still have. On top of that, simply list any other expenditures you can think of (estimates are ok) and say you don't have receipts. Most people can demonstrate spending above the amount they receive for the kids.

 

The more paper you can give them the less they will bother you.

 

Other things to think about:

Entertainment (movies, school outings, vacations!, meals when taking trips)

Clothing

School supplies

Medical expenses (you should have EOB's to oshow what you were responsible and if you don't, ask your health insurer for an annual printout)

Sports team fees

Allowances

 

 

Don't worry,

Mike

[MikeR]

Nymets,

 

There is no limit on how much you earn for KIDS' survivor benefits. If you are getting DIRECT survivor benefits, there is a limit. I also was the primary earner (the only earner, actually - my wife stopped working to take care of the kiss). I got benefits for both kids and I continued to work full time, earning well above the $17,000 mentioned in other posts.

 

Jennica,

As far as saving for college goes, it doesn't matter what money you save - cash is fungible. You can't say which dollar is yours and which is SS money if it's all in the same account. If they give you a dollar and you put it into your bank account, then spend a dollar on your kids, which dollar did you spend? Yours or SS's?

 

I have investment accounts for both of my kids, I used one for my somn's college and waiting to use the other for my daughter. I have the SS money paid into a regular bank account and then my financial guy automatically withdrawn money to put into their college accounts. I find it to be easier that way.

 

In general:

If you say you saved any amount, they will keep track and when your child turns 18 they will ask for it back and will then send your 18 y.o. a check for that amount. Although you could ask your kid to turn the money over to you, they don't LEGALLY have to. Why go through that? Just write that you spent it all.

 

Copies of mortgage payments (or rent checks), utility bills, phone bills, etc. are perfectly acceptable documentation of expenses. If you have one child, you can allocate 50% of those expenses to them. If you have 2 kids, they each get 1/3 allocated (2/3 total!). Just copy the bills, write on the copies how much was for the kid(s) and send them to SS. The more paper you inundate them with, the less likely they will keep asking questions.

 

An example:

                            Monthly Major Expenses

                            Total Amount  Amount allocated to 1 kid

Rent                      $1,000            $500

Utilities (heat, elect) $  150            $  75

Food                      $  200            $100

Clothing                  $    30            $ 50

Auto Exp                $  100            $ 50

 

Total                      $1,480            $740

 

Annual allocated to kid - $8,880.

 

This doesn't include any other expenses such as entertainment, school, vacations, toys, etc. As you can see, it isn't that hard to get to the total SS is giving you!

 

MikeR

[Jennica]

Thank you for this. This information is so helpful!!!

 

Jennica

[cathead]

Don't forget birthday gifts, Christmas gifts, any extracurricular activities or private lessons, sports equipment, meals out, movies out, any special TV programming you buy for him, his cellphone (if he has one), dental care, etc.