As Power Attorney for a friend if her Long Term disability benefits (taxable) checks are made payable to me will this affect my taxable income?

[pelogan55]

My disabled friend who is unable to obtain a checking account has appointed me Power Of Attorney...she will be receiving a Long Term Disability Check and the company wants to make the check payable to me with comments on the check benefits for my friend... will this income affect my taxable income?

[Carl]

Tell the company NO... NOT UNDER ANY CIRCUMSTANCES WHAT_SO_EVER! If the checks are payable to you, then the tax reporting document the payer will send at tax time, will be for **YOU**. You should "NEVER" give your SSN to an entity that can not prove a legal need for it. The issuer has no legal need for your SSN, because *YOU* are not the intended recipient of the money.

You have a POA. That POA should empower you to endorse, deposit and cash the checks for the intended recipient. If it does not, then the attorney who drew it up needs to "make is so".

[pelogan55]

They do not have my SSN..nor have they ask for it....and I definitely would not provide it...

[xmasbaby0]

Why is your friend unable to open her own checking account and just add your name to it as POA?

[pelogan55]

Unfortunately due to past banking history she was denied an account

[xmasbaby0]

She cannot establish an account at ANY bank??

[pelogan55]

No...not even Wells Fargo who has a,Second Opportunity banking accounts

[xmasbaby0]

wow...well, Carl is right.  Under no circumstances should you give them your SSN or allow that money to be reported as income to you.  Beware--no good deed goes unpunished.

[pelogan55]

They never have ask for my SSN...and have stated that these checks will not count against my income...just trying to get some verification...maybe I will ask the company for a verification statement

[macuser_22]

What type of disability payments?  How will the income be reported - what form?  (1099-R perhaps) It is entirely possible for the payments to be made to the POA FBO (For Benefit Of) the taxpayer and reported to the IRS under the taxpayers SSN, not the POA's.   That is quite common for disabled taxpayers or if there is a trust.

[pelogan55]

Long Term Disability payments  through employer....will ask the question  tomorrow about  how the income will be reported...Thank you...

[macuser_22]

That sounds like disability payments from a pension plan.  I assume that the person is under the earliest age of retirement from that employer (usually age 55) so it is disability rather than pension and would be reported on a 1099-R form with a code "3" (disability) in box 7 rather than a code "7" normal distribution.   If that is the case then the 1099-R would be issued to the employee with the employees SSN.

[Carl]

Don't just ask the employer either....get it in writing. Something just doesn't seem quite right here. The intended recipient should still be able to get something akin to a NetSpend or EBT card where the payments can be sent. Since those cards don't work if there's no money in the account, that should be easy and perfectly doable.