The question comes up more often than you might think: People are caring for a grandchild and want to know if they can get Social Security benefits for the child.
This is a very different question when it comes from grandparents rather than parents. Parents who have young children can, upon applying for their own retirement or disability benefit, apply for dependent benefits for the child. Likewise, if a parent dies, the surviving parent can apply for Social Security benefits for the child based on the deceased parent’s work record. The rules are very clear on this. RS 00203.001 Entitlement and Non-Entitlement Provisions for Child’s Benefits says: “To be entitled to Child’s Benefits, the child must be the child of a number holder (NH) entitled to Retirement Insurance Benefits (RIB) or Disability Insurance Benefits (DIB), or a NH who died fully or currently insured.”
Because there can be some question as to who can be considered a child, there is a whole subcategory of references, GN 00306.000 Child Relationship and Dependency. The most common questions about children’s benefits relate to stepchildren, adopted children, illegitimate children (where the parents aren’t married), and even equitably adopted children (where the adoption was never finalized but the child has inheritance rights). Because these rules are so technical, you should always go to the Social Security Administration (SSA) whenever children are involved. You don’t want to assume a child isn’t eligible for benefits just because the parents never married or the stepparent never adopted the child, for example. Let SSA make that determination.
But getting back to grandparents. The rules here are pretty clear. It’s still a good idea to go to SSA if there’s any question about a child being eligible for benefits, but here’s some preliminary guidance based on GN 00306.235 Entitlement Requirements—Benefits Based on E/R of Grandparent (Entitlement Requirements (E/R)).
A “child” for Social Security purposes is a child under age 18 (or 19 if still in high school), or an adult disabled child whose disability started before age 22. Remember, when we talk about either grandparents or parents “getting” benefits for a child, it is really the child who is getting the benefits. The parent or grandparent may receive the checks on behalf of the child as representative payee, but whether such benefits are paid at all depends on whether the child is eligible based on his or her relationship to the number holder (NH), to use Social Security’s terminology—that is, the parent or grandparent who is receiving retirement or disability benefits or who is deceased. Either of those two events, the filing for retirement or disability benefits or the death of a number holder can trigger benefit eligibility for a child.
A “grandchild” for Social Security purposes is the natural or legally adopted child or stepchild of the child of the number holder (NH) or his or her spouse. A great-grandchild does not qualify under this provision.
A grandparent who legally adopts a grandchild can certainly receive benefits for the child on the same terms that a parent can, since the child is now a legally adopted child of the grandparent. Adoption by a grandparent is rare. Most situations are where a grandparent is taking care of a child, for whatever reason. So it’s important to determine the reason because it relates to the second way a child can receive benefits off a grandparent’s record.
If, when a grandparent applies for retirement or disability benefits where the child’s parents are deceased or disabled, the child can receive benefits based on the grandparent’s record. Of course, if one of the child’s parents is deceased or disabled, that may create eligibility based on the parent’s record. If that parent had enough earnings credits to qualify for Social Security before becoming deceased or disabled, the benefit to the child may be higher than the benefit based on the grandparent’s work record. And this is another reason to go to SSA. If a child qualifies for benefits on more than one work record, SSA will determine the higher benefit and pay that one.
In addition, there must be dependency—in other words, in order for a child to receive benefits based on a grandparent’s work record, the child must live with and receive at least one-half support from the grandparent.
Based on these rules, many grandchildren living with their grandparents will not qualify for benefits based on the grandparent’s record because the grandparent hasn’t adopted the child and the parents are not deceased or disabled. So you might think about what a grandparent can do to get benefits for the child. Where feasible, grandparents might consider adopting if it would mean many thousands of dollars in Social Security benefits for the child. Otherwise, explore whether or not the parent could meet Social Security’s definition of disabled: if the grandparent is keeping the child because the parent is physically or mentally unable to do so, that might meet SSA’s definition. And of course, if the parent is deceased, that would qualify the child to receive benefits based on the grandparent’s work record—or the parent’s if higher.
Section D of GN 00306.001 Determining Status as Child, instructs field office workers to “explore all possibilities of entitlement before disallowing a child’s claim because the relationship requirements are not met.” Section B says, “Do not attempt to work complex child relationship claims without referring to the appropriate POMS section shown in the chart.” Apparently SSA takes children’s claims seriously and understands the myriad complexities that can arise from the various relationships, legal and otherwise. Take your cue from SSA: if there is any possibility a child can be entitled to Social Security benefits, you are encouraged to sit down with an SSA worker and explore the possibilities.
Original article for an adviser newsletter by Elaine Floyd, CFP®, Director, Retirement and Life Planning, Horsesmouth, LLC, within which I’ve made edits for the broader public.