What are Derivative Benefits?
Though it sounds like a complicated financial product — perhaps offered by a fancy Wall Street investment firm — derivative social security benefits are in fact relatively simple to understand. They are payments that go to the children of parents who receive social security, either due to disability or retirement. But how does this play out in child support situations? This article examines this issue.
From a family law perspective, derivative payments can be used in cases where a non-custodial parent, who is required to pay child support, has become disabled, or has retired. In some cases, a disabled non-custodial parent receiving social security might not have to pay child support with out-of-pocket money.
Typically, children approved for derivative benefits are entitled to a specific amount of money from the federal government — a figure based on the total amount of social security issued to the disabled parent each month.
This article was written to offer some general information on what derivative social security benefits are, as well as describe what makes a child eligible to receive them. This article also generally discusses some key issues that can arise in divorce situations involving derivative benefits, such as a parent who refuses to cooperate with the Social Security Administration and attempts to make things difficult for the disabled supporting parent.
Though this page discusses specific section of the Family Code, as well as some legal terms, it is not intended as legal advice. Continue reading to learn more about this area of family law. If you have a specific family legal question, contact our office to schedule a consultation with our excellent JS Family Law Attorney.
Some Basic Stats on Social Security Derivatives, And Who Is Eligible To Receive Them
According to the Social Security Administration website, nearly 4.3 million children receive monthly benefits from the $2.6 billion in funds the administration distributes each month.
In order for a child to receive these benefits, he or she must meet the following requirements:
- Have a parent who’s either disabled or retired, and eligible to receive Social Security benefits
- Be unmarried
- Be younger than 18, or
- If older than 18, he or she must be disabled
- If between the ages of 18 and 19 years, he or she must be in school (not above grade 12)
In some cases, it might also be possible for a child to collect social security benefits after a parent has died. However, in order to qualify, the parent must have worked long enough to have paid social security taxes.
When the Disabled Parent is Not the Custodial Parent, and Has a Child Support Obligation
If a child meets the above listed requirements and has a non-custodial parent receiving social security who owes child support, the minor may be entitled to receive a specified amount of money based on the primary social security payment.
Regardless of whether or not a parent is disabled, they can still be expected to make monthly support payments. Courts base child support payments on a parent’s gross annual income.
According to California Family Code §4058, a parent’s gross income can come from a number of different sources, including social security. For a parent dealing with disability, or reduced income due to retirement, making timely child support payments — particularly when social security is a prime source of income — can be challenging. This is where derivative payments can be extremely helpful.
Say for instance that a disabled, non-custodial parent owes $350 in child support each month. This parent receives as a prime source of income, a monthly payment from the Social Security Administration because of the disability. If the derivative benefit available to this person’s child is $350, the non-custodial parent might not have to pay anything out-of-pocket for child support (assuming all filing procedures are followed).
However, in order for the child to receive the derivative payment, the custodial parent must notify the Social Security Administration of the child support agreement. This can be problematic in certain family situations. Continue reading to learn more.
What If a Parent Refuses To Apply for Derivative Benefit?
Sometimes animosity exists between former spouses — this is a sad fact of divorce.
Imagine a situation where a non-custodial spouse is receiving social security benefits, and his or her children are eligible for derivative benefits. Due to bitterness, the custodial parent doesn’t take the steps necessary to obtain the derivative benefits for the eligible child or children. The custodial spouse realizes that applying for these benefits would help the non-custodial spouse financially, and as a result, refuses to cooperate with the Social Security Administration.
California Family Code §4504(a) addresses this issue.
Under the law, when a custodial parent is notified of the other parent’s social security benefits, they are required to in turn notify the appropriate federal agency
“within 30 days of receiving notification that the noncustodial parent is receiving those payments to verify eligibility for each child to receive payments from the federal government because of the disability of the non custodial parent.”
The law further states, “If the child is potentially eligible for those payments, the custodial parent…shall apply for and cooperate with the appropriate federal agency for the receipt of those benefits on behalf of each child.”
In cases where a custodial parent refuses to cooperate with a federal agency in obtaining derivative benefits for the child, it might be necessary to consult a family lawyer.
If you are currently collecting social security benefits, owe child support, and have a former spouse who refuses to cooperate when it comes to derivative payments for the children, contact our office to see how we can help.
Dealing With Derivative Social Security and Family Issues—To Court, or Not To Court?
It’s unfortunate when ex spouses with children can’t put aside their differences and simply do what is in the best interests of the kids. It’s hard to believe that there are cases where a child is entitled to money from the government, and rather than taking advantage of a good opportunity, a custodial parent instead tries to “stick it” to the other parent.
While there’s no reason for two rational people acting in good faith to end up in court over a situation like this, it’s a sad fact of life that not all people act rationally. While the courthouse is usually viewed as a last resort in family cases, sometimes it becomes a necessary destination.
If, after consulting with a lawyer, the decision is made to take a custodial former spouse to court so that the children can receive derivative payments, it might be recommended that you also seek attorney’s fees. California law seeks to encourage settlements between former spouses, and even provides sanctions for those who stall attempts to settle divorce and custody cases. California Family Code § 271 states the following:
“The court may base an award of attorney’s fees and costs on the extent to which the conduct of each party or attorney furthers or frustrates the policy of the law to promote settlement of litigation.”
Consulting an Attorney
It’s important to keep in mind that it might not be necessary to take a former spouse to court in order to ensure your children receive social security derivative payments. Whether or not to go to court is a decision that you should discuss with a qualified attorney. Sometimes, there are less costly options available.
It goes without saying that divorce situations can be emotionally charged. When children are involved, things can get even more emotional. And when a parent is dealing with disability on top of it, it’s imperative that he or she has a qualified professional on the case.
When looking for an attorney to represent you in a family case, seek out a professional with excellent communication skills. A family lawyer should be highly capable of taking complex legal information and explaining it in simple terms —whether in a courtroom setting — or over the phone. If you are struggling with a disability and have to pay child support, contact our office to schedule a consultation. See how we can help.