Social Security Benefits

A Guide to Social Security Survivors Benefits

What are Survivors Benefits: A Brief History

Economic insecurity was a social issue our nation addressed over 80 years ago with the enactment of the Social Security Act in 1935. What most people don’t realize is that the Act also provides survivors benefits: spouses, children, and dependent parents of a deceased worker can receive survivors benefits. Yet, few people understand the program rules for eligibility and may be reluctant to ask.

How to Become Insured for Survivors Benefits

Eligibility for Social Security survivors benefits is a matter of insured status. With few exceptions, a worker can insure his or her family for Social Security survivors benefits once the worker has 40 quarters of covered earnings. Breaking this down more simply: that’s 10 years of employment where the worker earned at least $5,640 per year, or $1,410 per quarter (2020 required amounts—prior years may be lower), in wages or self-employment income. The actual benefit amount will vary depending on the worker’s individual earnings and the number of quarters of taxes paid on those earnings, and can be greater for a family with more than one survivor (e.g. surviving spouse with surviving minor children in the care of a surviving spouse).

However, if the worker had income or wages not subject to the FICA tax then the worker will not be insured. Some examples are (1) state employees or public school teachers who pay into a state-sponsored, exempt retirement system, or (2) self-employed workers who fail to report their earnings to the IRS. 

Who Can Receive Survivors Benefits?

This is a 2-part question. First, is the question of the worker’s insured status (see above). Second, is the question of the survivor’s relationship to the deceased worker. Spouses and children may be eligible to claim on their deceased spouse or parent’s work record, but they must be able to prove their legal relationship to the deceased spouse/parent. Social Security follows state laws concerning the family relationship. For a child, this could become an issue if parentage was never established during the worker’s lifetime. For spouses that were “common law” married to the worker, but were never married in a civil ceremony, this could also pose a problem. A probate attorney can counsel and assist the family with the necessary state court proceedings to establish these family relationships. 

When Should You Apply for Survivors Benefits?

Application should be made as soon as you learn of the worker’s death, or otherwise become eligible under Social Security rules. Social Security will not pay more than 6 months of retroactive benefits for a minor child and 12 months for an eligible surviving spouse. Additionally, it’s important to understand that only eligible survivors can receive Social Security survivors benefits. Children can receive survivors benefits, but only until they are 18 years old and have graduated high school. Additionally, the living parent caring for a surviving minor child under the age of 16 may be eligible for Social Security survivors benefits if that parent had been married to the worker. This is true even if the surviving parent was divorced from the worker before the death occurred. An adult child who became disabled prior to the age of 22 may be eligible to receive survivors benefits into adulthood.

A surviving spouse is entitled to survivors benefits once they reach age 60 and as long as they have not re-married prior to then. However, if the surviving spouse is disabled, then they can apply for survivors benefits as early as age 50, but must apply within 7 years of the deceased spouse’s death. Additionally, if a surviving spouse claims the survivors benefits prior to their full retirement age, the benefit will be reduced. Finally, a divorced surviving spouse is also entitled to survivors benefits if they were married to the worker at least 10 years and did not re-marry prior to the age of 60.

Social Security survivors benefits can provide financial security during a time of loss. Understanding your benefits is a first step to preparing a lasting legacy for your family.

If you have questions about Social Security survivors benefits in the Dallas, Plano, McKinney, Frisco, Allen, & Prosper area, contact me, a Social Security Attorney, to discuss further. In addition to in-person consultations, I am also available by teleconference and videoconference. I also represent individuals in probate and guardianship proceedings needed to establish family relationships for the purpose of receiving Social Security survivors benefits.

Avoid Probate Image

7 Ways to Avoid Probate

Can I estate plan to avoid probate? In short, yes, there are some ways to exclude assets from probate.

What is Probate?

Probate refers to the legal process for distributing the assets of a deceased person, and often requires the assistance of an attorney and a court proceeding. Not only does probate come with a cost, court proceedings are a matter of public record. Privacy is also a driving factor in avoiding probate. Some of the below methods provide for the the transfer of assets without any public disclosures.

Here are a few estate planning methods for probate avoidance in Texas:

  1. Living Trust—In Texas, a fully funded Living Trust could potentially avoid the probate process. Any assets transferred to the trust can be administered and distributed according to the terms of the trust, even after the creator of the trust dies, and without the need for a court proceeding.
  2. Lifetime Gifting—Why wait until you die? You can transfer your assets during lifetime as a gift, and once that transfer is completed, the assets are not subject to probate. Gifting is also a great way to plan around potential estate taxes because certain lifetime gifts are excluded from the federal estate gift tax.
  3. Payable on Death accounts—Many financial institutions offer checking, savings, and brokerage accounts with a payable on death option. This is a contract between you and the financial institution that tells them who to pay the account balance to upon your death. The person you designate as the beneficiary of the account has no right to access account funds during lifetime. However, caution should be exercised here. Financial institutions often include terms in their depository agreements that give them the option to apply account balances at death to unpaid fees or even loan balances before distributing any funds to your designated beneficiary. Additionally, these account funds could be subject to garnishment for the payment of funeral expenses.
  4. Beneficiary Designation(s)—This method allows you to designate a beneficiary of the proceeds of a life insurance policy, or funds saved in a retirement account, upon your death.
  5. Transfer on Death Deed (TODD)—this is a Deed that providers for the transfer of real estate upon the death of the owner. If the deed is properly drafted, executed, and recorded in the deed records prior to death, the real estate will transfer to the beneficiary designated on the deed without the need for probate.
  6. “Ladybird” Deed—This is a Deed similar to a Transfer on Death Deed, because the effect of this deed is to transfer real estate to a person named on the deed without the need for probate. Users of this method should also proceed with caution and consult an estate planning attorney because this method has no statutory basis.
  7. Affidavit of Heirship—This method is used after a person dies, usually by the heirs of the deceased person’s estate during a real estate sales transaction in which all parties are agreed. An Affidavit of Heirship simply documents facts concerning the identity of the deceased person and his or her heirs and is filed in the deed records.

Plan for Avoiding Probate

As the saying goes, “the best laid plans of mice and men often go awry”, and engaging in self-help to avoid probate is no exception. Consult an estate planning attorney or probate attorney if you have any concerns about the probate process. Most of the time, probate cannot be avoided. Too often people leave behind assets that they neglect to plan for and most of the above-listed methods require careful, advance planning. Additionally, financial institutions prefer to act under court documents that appoint someone to act on behalf of the estate.

However, probate complications can be mitigated with careful estate planning. Moreover, probate can be a great tool for dealing with the debts a person leaves behind and should be carefully considered anytime someone dies with substantial debt.

If you have questions about estate planning to avoid probate here in the Dallas, Plano, McKinney, Frisco, Allen, & Prosper area, contact me to discuss further. In addition to in-person consultations, I am also available by teleconference and videoconference. 

Featured Speaker

Attorney Adriane Grace Featured Speaker at the 2020 North Texas Probate Bench Bar Conference

The North Texas Probate Bench Bar is a yearly conference held in March during which time members from the probate bench and bar (judges and attorneys) from North Texas come together to hear updates on important legal topics in Estate Planning, Probate, and Guardianship. This year, Attorney Adriane S. Grace was selected by the planning committee to speak at a general assembly of the bench and bar on March 5, 2020 about “Social Security Rules the Estate Planning, Guardianship, and Probate Attorney Should Know.”

Featured Speaker

Attorney Adriane S. Grace featured speaker at the 2020 North Texas Probate Bench Bar Conference

As a Social Security Appeals Attorney and a practitioner in probate and guardianship law, Ms. Grace has identified overlaps in Social Security procedural rules and state laws on probate and guardianship. Ms. Grace used the speaking opportunity to educate local judges and her colleagues about these overlapping rules and how to navigate these issues as well as provided an update on new Social Security rules pertinent to their practice areas. As a former appellate attorney for the Social Security Administration, Attorney Adriane S. Grace possesses intricate knowledge of Social Security processes and procedure as well as the agency policies driving their rules. She is often called upon by colleagues practicing in many different areas of law for advice and assistance when their cases become impacted by Social Security issues.

The North Texas Probate Bench Bar conference is a well-attended event by estate planning and probate attorneys from Dallas, Collin, Denton, Tarrant, Rockwall, and Grayson counties as well as all the statutory probate judges and county court at law judges hearing probate cases in these counties. This year, there were approximately 300 attendees.