Handling Back Pay Child Benefits Paid to a Now-Adult Child

By / After You’re Social Security Disability Benefits are Approved / 31 Comments

Learn how to handle a delayed Social Security Disability payment for a minor child of a disabled adult, when it arrives in the child’s name after they’ve reached adulthood. Must the money be shared with the parent?

Dear Disability Advisor,

My stepmother recently informed me that I would be receiving in my name back pay benefits for when I lived with her as a teen off her disability claim. I am now 32 and had no idea this claim existed. But she has told me that the money belongs to her. Am I to hand it over to her? Will I have to pay taxes on the amount? Which is over $40,000 that has been awarded. Just really want to do the right thing but some of that money could really help out me and my family.


Dear Susie,

The money legally belongs to you, and you will have to pay taxes on at least part of it. How much will be taxable will depend on your total adjusted gross income when you file your taxes. When you receive the funds, I suggest that you get an estimate of your 2017 tax liability by contacting a tax accountant so that you can pay the estimated taxes when due, which is usually the calendar quarter in which the taxable income is received.

You might consider giving part of the benefits that do not have to be used for taxes to your mother in consideration of the expenses she had caring for you when you were a minor and while her Social Security claim pended for a number of years.

The Disability Advisor

Handling Back Pay Child Benefits Paid to a Now-Adult Child
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