Tuesday, December 4, 2012

Deadline to Switch to Electronic Federal Benefit Payments is Near

Over the past several years, the US Treasury Department has been phasing out paper check payments and requiring federal benefit recipients to get their money electronically. Now the March 1, 2013 final deadline is near: on that date people who still receive a paper check in the mail for their Social Security, SSI or veterans benefits are required by law to switch to an electronic payment option. 

Many younger retirees are already receiving their government benefits electronically. Effective May 1, 2011, new applicants filing for all federal payments were required to receive their payments electronically, unless they qualified for one of a very few exemptions. But beneficiaries who were already receiving a paper check on that date were given until March 1, 2013 to make the change. Now, that final switch date is fast approaching. 

Seniors can have their entitlement payments directly deposited into a bank or credit union account or loaded onto a prepaid debit card. Benefit recipients can sign up for direct deposit at www.GoDirect.org, by calling the U.S. Treasury Electronic Payment Solution Center at (800) 333-1795, or by speaking with a bank or credit union representative.  

Choose Your Payment Option. Before making the switch, decide which payment option you would like. If you are unsure, you can call the U.S. Treasury Electronic Payment Solution Center at (800) 333-1795 to speak with an agent who will help you choose the best option for you. 

The U.S. Department of the Treasury recommends two electronic payment options:
       Direct deposit. If you have a checking or savings account, sign up to get your money by direct deposit. Your federal benefit payment will go straight into your account on payment day each month.
       Direct Express® card. If you don’t have a bank account or prefer a prepaid debit card, switch to the Direct Express® card. Your money will be posted to the card account on payment day each month. There’s no need to wait for the mail or to make a special trip to cash a check. You can make purchases and get cash back with purchases at no charge anywhere Debit MasterCard® is accepted. There are no sign-up fees, overdraft fees or monthly fees. Some fees for optional services may apply. For information on card fees and features, visit www.GoDirect.org.

If you do not choose an electronic payment option by March 1, 2013, you will be issued a Direct Express® card.

Note that if you are already receiving your federal benefit payments electronically, this change will not affect you.

Waivers from electronic payment requirements. Waivers from the electronic deposit requirement will be granted in a few circumstances. People born prior to May 1, 1921 who are receiving Federal payments by check on March 1, 2013 are exempted. In addition, beneficiaries may receive a waiver based on hardship such as mental impairment. (Consult §208.4(a)(1) of the regulations linked below for additional information on these waivers.)

Benefits of Electronic Payments
·      Electronic payments provide a number of advantages over paper checks, including:

o  You'll get your benefits on time, even if you're out of town, sick or unable to get to the bank.

o  Crime protection: More than 440,000 Social Security and Supplemental Security Income checks were reported lost or stolen in 2011. Electronic payments can help protect against check theft and other financial crimes.

o  Disaster readiness: Electronic payments help protect money from delivery disruptions caused by severe weather and other unforeseen events.

Further Information:

1 comment:

tahir sumar said...
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