Notch Bulletin: Not Even A Lump Sum Death Benefit

Notch Bulletin: Not Even A Lump Sum Death Benefit

Recently, we received the following from one of our readers:
My sister was in the “Notch Group” and she struggled to get along on her meager benefit. She passed away a little over a year and half ago and those sorry rotten people in Social Security would not even pay the death benefit because she had no children.

When Social Security was first enacted in 1935, it included a lump-sum death benefit to be paid if a worker died before the retirement age. The death benefit was paid to a family member or individual who helped pay burial expenses. By the 1950’s it was even payable to funeral homes.

But in 1981, about the time when your sister was retiring, Congress narrowed eligibility for the benefit to its current status. The death benefit of $255 may be paid on the death of a person who receives Social Security benefits based on his or her own work record. The $255 is limited to a spouse or child.

The death benefit is payable to the surviving spouse if he or she was living with the beneficiary at the time of death, or, if the surviving spouse is living apart from the beneficiary, the $255 can be paid if the survivor is eligible for benefits on the deceased beneficiary’s earnings record for the month of death. If there is no surviving spouse, the payment can be made to a child who was eligible for benefits on the deceased’s earnings record in the month of death. It is no longer payable to funeral homes.

On the other hand, Notch Babies and their families can have a reason to be encouraged over progress on Notch Reform legislation. Support for “The Notch Fairness Act” (H.R. 368) is at its highest level ever. The legislation, introduced by Representative Ralph Hall (TX), would provide Notch Babies born from 1917 through 1926 their choice of a $5,000 lump sum payable in four annual installments, or an improved monthly benefit. As of July 31, 2008, the legislation had gained 125 cosponsors. In addition, a resolution has been introduced in the Senate (S. Res. 363) that calls for Notch Reform legislation.

We urge Notch Babies and family members like you to vote for Members of Congress who co-sponsor Notch Reform legislation. To find out if your Representative supports “The Notch Fairness Act,” visit our website at or call toll free at 1-800-333-8725. Make sure your voter registration is up to date. We are continuing to meet with Members of Congress on Capitol Hill pushing for this long overdue settlement.