Changes to the Administrative Rules for Claimant Representation and Provisions for Direct Payment to Entities, 51747-51756 [2023-16405]

Agencies

• Social Security Administration

[Federal Register Volume 88, Number 149 (Friday, August 4, 2023)]
[Proposed Rules]
[Pages 51747-51756]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-16405]


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SOCIAL SECURITY ADMINISTRATION

20 CFR Parts 404, 416, and 422

[Docket No. SSA-2023-0018]
RIN 0960-AI22


Changes to the Administrative Rules for Claimant Representation 
and Provisions for Direct Payment to Entities

AGENCY: Social Security Administration.

ACTION: Notice of proposed rulemaking.

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SUMMARY: We propose to revise our regulations to enable us to directly 
pay entities fees we may authorize to their employees, as required by 
the decision of the United States Court of Appeals for the First 
Circuit (First Circuit) in Marasco & Nesselbush, LLP v. Collins. To 
make direct payments, issue the necessary tax documents, and properly 
administer these rules, we propose to require all entities that want to 
receive direct payment of assigned fees and all representatives who 
want to be appointed on a claim, matter, or issue to register with us. 
We also propose to standardize the registration, appointment, and 
payment processes. We expect that this proposed rule will help us 
implement the changes required by the Marasco decision, increase 
accessibility to our electronic services, reduce delays, and help us 
prepare for more automation, thereby improving our program 
efficiencies.

DATES: To ensure that your comments are considered, we must receive 
them by no later than October 3, 2023.

ADDRESSES: You may submit comments by any one of three methods--
internet, fax, or mail. Do not submit the same comments multiple times 
or by more than one method. Regardless of which method you choose, 
please state that your comments refer to Docket Number SSA-2023-0018 so 
that we may associate your comments with the correct regulation.
    Caution: You should be careful to include in your comments only 
information that you wish to make publicly available. We strongly urge 
you not to include in your comments any personal information, such as 
Social Security numbers or medical information.
    1. Internet: We strongly recommend that you submit your comments 
via the internet. Please visit the Federal eRulemaking portal at 
https://www.regulations.gov. Use the ``search'' function to find Docket 
Number SSA-2023-0018. The system will issue a tracking number to 
confirm your submission. You will not be able to view your comment 
immediately because we must manually post each comment. It may take up 
to a week for your comment to be viewable.
    2. Fax: Fax comments to 1-833-410-1631.
    3. Mail: Mail your comments to the Office of Legislation and 
Congressional Affairs, Regulations and Reports Clearance Staff, Social 
Security Administration, Mail Stop 3253 Altmeyer, 6401 Security 
Boulevard, Baltimore, Maryland 21235-6401.
    Comments are available for public viewing on the Federal 
eRulemaking portal at https://www.regulations.gov or in person, during 
regular business hours, by arranging with the contact person identified 
below.

FOR FURTHER INFORMATION CONTACT: Mary Quatroche, Director, Office of 
Disability Policy, Office of Vocational Evaluation and Process Policy, 
Social Security Administration, 6401 Security Boulevard, Baltimore, MD 
21235-6401, (410) 966-4794. For information on eligibility or filing 
for benefits, call our national toll-free number, 1-800-772-1213 or TTY 
1-800-325-0778, or visit our internet site, Social Security Online, at 
https://www.ssa.gov.

SUPPLEMENTARY INFORMATION: 

Background

    Any person who claims a benefit under our programs may appoint a 
representative(s) to assist with their claim, and the representative(s) 
may seek a fee for the services they provide. We must generally 
authorize any fee that the representative(s) wants to charge or 
collect. If we authorize a fee to the representative(s), we may also 
pay

[[Page 51748]]

that fee directly out of the claimant's past-due benefits, if certain 
conditions are met.\1\ These representatives may be employed by an 
entity, but currently, we do not directly pay the entity for work 
performed by a representative it employs.\2\
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    \1\ Generally, we will pay the fee directly if the 
representative is registered and eligible for direct payment; has 
not withdrawn or been revoked prior to the favorable decision; and 
did not waive the fee or direct payment of the fee. See Program 
Operations Manual System (POMS) GN 03920.017.
    \2\ Entity means any business, firm, or other association, 
including but not limited to partnerships, corporations, for-profit 
organizations, and not-for-profit organizations. See 20 CFR 404.1703 
and 416.1503.
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    In 2017, Marasco & Nesselbush, LLP, a law firm, brought an action 
in Federal court alleging, among other things, that the law firm's 
employees had no direct right to authorized fees and that their 
salaries do not depend on the amount of fees generated by the 
disability cases in which they act as representatives. On July 16, 
2021, the First Circuit issued a decision instructing us to find a 
reasonably reliable means for law firms to receive direct payment of 
fees we authorize to their salaried employees while correctly reporting 
the income to the Internal Revenue Service (IRS).\3\ On remand, the 
United States District Court for the District of Rhode Island issued an 
order requiring us to, among other things, undertake good faith efforts 
to develop a process within 24 months from the date of its March 23, 
2022 order to ensure that law firms that employ salaried associates to 
represent claimants may receive direct payment of fees to which the 
associates are entitled for representation performed while employed by 
the law firms.\4\
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    \3\ Marasco, 6 F.4th 150, 178 (1st Cir. 2021).
    \4\ See Order, ECF No. 63, Marasco & Nesselbush, LLP v. Collins, 
No. 17-cv-317 (D.R.I. Mar. 23, 2022). A copy of the district court's 
order has been submitted to the rulemaking record in the supporting 
documents.
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    Each year we directly pay, on average, almost a billion dollars in 
fees authorized to appointed representatives in title II cases 
alone.\5\ Standardization and accuracy are essential to meet our 
stewardship duties because these direct fee payments are made from 
claimants' past-due benefits. To implement the First Circuit's decision 
in a responsible, timely, efficient, and practical manner, we are 
proposing changes to standardize several processes in our rules, 
including: (1) registration of representatives and entities; (2) 
assignment of representational fees to entities for direct payment, as 
well as rescission of assignment; (3) point of contact (POC) 
requirements for the entity; and (4) direct payment to entities by 
electronic funds transfer (EFT). Below, we explain why and how these 
four elements are necessary to implement the court's decision.
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    \5\ In 2022, we paid $923.9 million in authorized fees for title 
II claims. See https://www.ssa.gov/representation/statistics.htm#2022.
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I. Definition of Terms for Purposes of This Proposed Rule

    We propose to define, or redefine, certain terms as they will be 
used in our rules on representation.\6\ These definitions would only 
apply within the context of our rules on representation found at 20 CFR 
404.1700 et seq. and 416.1500 et seq. We would include these 
definitions in 20 CFR 404.1703 and 416.1503.
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    \6\ 20 CFR part 404, subpart R and part 416, subpart O.
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    We propose to define Assignment to mean the transfer of the right 
to receive direct payment of an authorized fee to an entity. This 
defined term is used in changes proposed to 20 CFR 404.1703, 404.1730, 
416.1503, and 416.1530.
    We propose to define a Point of Contact to mean an individual who 
is a registered representative selected by an entity to speak and act 
on the entity's behalf and who assumes the affirmative duties and 
obligations we prescribe. This defined term is used in changes proposed 
to 20 CFR 404.1703, 404.1735, 404.1740, 416.1503, 416.1535, and 
416.1540.
    We propose to define Registration to mean a process by which a 
representative or entity provides the information we require to conduct 
business with us. This defined term is used in changes proposed to 20 
CFR 404.1703, 404.1705, 404.1735, 416.1503, 416.1505, and 416.1535.
    We propose to redefine Representative to mean an attorney who meets 
all the requirements of 20 CFR 404.1705(a) and 416.1505(a), or a person 
other than an attorney who meets all the requirements of 20 CFR 
404.1705(b) and 416.1505(b), and whom you appoint to represent you in 
dealings with us. For purposes of our rules of conduct and standards of 
responsibility, Representative also includes an individual who provides 
representational services and an individual who is listed as a POC for 
an entity, as applicable to their identified role. This defined term is 
used in changes proposed to 20 CFR 404.1703, 404.1720, 404.1740, 
416.1503, 416.1520, and 416.1540.

II. Allowing Representatives To Assign Direct Payment of Authorized 
Fees to Entities

    Under this proposal, to comply with the Marasco decision, reduce 
burden, and improve efficiency, we would allow representatives to 
assign their right to receive direct payment of an authorized fee to an 
entity on each claim. If the applicable conditions explained in Section 
VI are met, we would accept an assignment and certify payment of the 
authorized fee to the entity. We would make these changes in 20 CFR 
404.1720 and 416.1520.

III. Registration by All Representatives and Use of the Representative 
ID (Rep ID)

    Currently, representatives who want direct payment of fees or 
access to our electronic claim(s) file (eFolder) must register with 
us.\7\ To register, representatives complete and submit Form SSA-1699 
(OMB No. 0960-0732), ``Registration for Appointed Representative 
Services and Direct Payment.'' \8\ To protect representatives' privacy, 
we created the Representative Identification number or Rep ID, which we 
issue to the representatives during registration to use in lieu of 
their Social Security number (SSN). The Rep ID is meaningful only 
within our systems. Among other purposes, we use the information we 
collect during registration to issue checks or EFT to the 
representative's preferred banking institution and to report the income 
on Form IRS 1099 (OMB No. 1545-0119), as required by the IRS.\9\ This 
information is also necessary to assess a user fee on each direct 
payment, as required by sections 206(d) and 1631(d)(2)(C) of the Social 
Security Act (the Act).\10\ We currently have several thousand 
registered representatives.\11\
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    \7\ 71 FR 58043 (Oct. 2, 2006).
    \8\ Id., at 58043-44.
    \9\ To pay an authorized fee directly to a representative we 
must collect certain information that enables us to meet our 
obligations under sections 6041(a) and 6045(f) of the Internal 
Revenue Code (IRC) as implemented by 26 CFR 1.6041-1. These sections 
require us to issue a Form 1099-MISC or 1099-NEC (whichever is 
applicable) to those who receive aggregate fees of $600 or more in a 
calendar year. To comply with this requirement, we collect the 
requisite information such as the representative's taxpayer 
identification number (TIN), and the address where we can send a 
check or the financial institution where we can send an EFT payment.
    \10\ The Debt Collection Improvement Act of 1996 (DCIA) provides 
that when an individual is doing business with an agency, such as 
when that person is assessed a fee, the agency head must require the 
individual to provide their TIN to the agency. 31 U.S.C. 7701(c)(1), 
(c)(2)(D).
    \11\ As of May 3, 2023, 43,620 attorneys and 2,955 eligible for 
direct payment non-attorneys (EDPNAs) were registered for direct 
payment and access to our electronic claim files in our centralized 
database, Registration, Appointment and Services for Representatives 
(RASR). Because we are unable to maintain detailed information on 
unregistered representatives in our centralized representative 
database, we do not have specific numerical data or statistics about 
this group.

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[[Page 51749]]

    Currently, we generally communicate with unregistered 
representatives via manual notifications. In this rule, we propose to 
require all representatives to register with us prior to being 
appointed on any claim. We expect several benefits from this proposed 
requirement. We expect that this requirement would allow us to conduct 
business more efficiently because it would allow us to automate more 
notices, minimize manual errors, properly track transactions and 
related communications, and improve our sanctions process. The proposed 
registration requirement would help us further automate communications 
that are managed by our centralized representative database and share 
the information with our secondary databases used to process cases at 
different adjudicatory levels, so these systems can also automate their 
communications. We expect that this increased automation would also 
make the processing of appointments and fee payments more efficient by 
reducing errors associated with manual actions. In addition, the 
registration requirement would enable us to better track all 
representatives' actions and conduct on their cases, rather than just 
those who choose to register with us, and it would extend access to our 
electronic services to more representatives. Access to our Electronic 
Records Express (ERE) system, for example, has been an important tool 
for representatives to obtain real-time information from our files in 
an easy and efficient way without the need to contact an agency 
employee for that information. Registration will continue to be a one-
time process unless the representative's information changes and 
registration data must be updated.
    We will also require representatives to register before being named 
as a POC for an entity. Requiring representatives to register with us 
before being designated as POCs would facilitate quicker processing of 
the entity's registration because the representative's information 
would already be in our system and would not need to be manually keyed-
in by a technician prior to processing the entity's registration. It 
would also allow us to readily identify and verify the POC when we 
share certain claim information to resolve fee matters and, if needed, 
ensure accountability under our rules of conduct as explained in 
Section VIII below. Registration would also help us ensure that we keep 
accurate and comprehensive records of our communications with the 
entities and their POCs. We would make these changes in 20 CFR 404.1705 
and 416.1505.

IV. Requiring Entity Registration Before We Accept a Request To 
Directly Pay an Entity

    To enable direct payments to entities and meet our mandatory tax 
reporting obligations to the IRS, we will need to collect information 
such as tax identification numbers, addresses, and banking institutions 
from entities. We currently ask representatives to voluntarily register 
the entity with which they are affiliated so that we can issue a copy 
of Form IRS 1099 to their employer to assist the parties in their 
accounting and tax reporting duties. When an entity elects not to 
register with us, we cannot issue a Form IRS 1099 to that entity. To 
pay an entity, we will need the entity to register before we can accept 
any assignment of direct payment so that we can ascribe income to the 
entity correctly. To register entities, we developed the standard Form 
SSA-1694 (OMB No. 0960-0731), ``Request for Business Entity Taxpayer 
Information'' to collect the entity's name and address to mail the Form 
IRS 1099.
    Under this proposed rule, registration would continue to be 
voluntary for entities not being assigned direct payment of authorized 
fees. Like representative registration, entity registration would be a 
one-time transaction unless the entity needs to update its information. 
However, any entity previously registered under our prior process that 
wants to receive direct payment of assigned fees would have to register 
again to provide additional information we do not currently have, such 
as its banking information and information regarding a designated POC. 
Entities would then be responsible, through their POC, for keeping 
their information accurate and current. To ensure we collect all the 
information we need to make direct payment and issue tax forms, we 
propose to require use of a standard process (currently this involves 
submission of the Form SSA-1694) to register. This would ensure that 
the information we need would be collected in one document to 
facilitate processing. We would make these changes in 20 CFR 404.1735 
and 416.1535.

V. Standardizing the Representative Appointment Process

    Our rules in 20 CFR 404.1707 and 416.1507 require claimants and 
their representatives to submit a written notice of appointment to 
inform us about the claimants' decision to engage representation. This 
notice allows us to confirm the person has the requisite qualifications 
to be a representative and recognize the person as the 
representative.\12\ Currently, we do not require the use of our 
standard notice of appointment Form SSA-1696 (OMB No. 0960-0527), 
``Claimant's Appointment of a Representative,'' to document 
representative appointments. However, in practice we find that most 
representatives and claimants use this form. We also do not currently 
require attorney representatives to sign a notice of appointment, 
whether they use our standard form or another writing, but do require 
non-attorneys to sign.\13\
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    \12\ See POMS GN 03910.020A.
    \13\ 20 CFR 404.1707 and 416.1507.
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    Our standard Form SSA-1696 collects information that helps us 
properly identify the claimant, the principal representative,\14\ and 
any other representative. It helps us collect other important 
information, such as the fee arrangement, which helps us determine 
whether we should withhold funds from past-due benefits for possible 
direct payment of any fee we authorize. It also helps us determine the 
representative's affiliation with an entity, which enables us to link 
the representative, the case, and the entity in our records, so that we 
may issue appropriate form(s) IRS 1099 for any payments we make in the 
case.
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    \14\ A claimant may appoint multiple representatives. However, 
if a claimant appoints more than one individual to serve 
concurrently, the claimant must designate one representative to be 
the principal representative. We contact and send notices or 
requests for development only to the principal representatives. They 
are expected to provide copies to other representatives. See POMS GN 
03910.040C (https://secure.ssa.gov/apps10/poms.nsf/lnx/0203905040), 
and Hearing, Appeals and Litigation Law manual (HALLEX) I-1-1-10C 
(https://www.ssa.gov/OP_Home/hallex/I-01/I-1-1-10.html) and I-1-1-11 
(https://www.ssa.gov/OP_Home/hallex/I-01/I-1-11.html).
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    In any adjudicatory system as large as ours, which processes 
millions of claims each year, ``the need for efficiency is self-
evident.'' \15\ To increase our efficiency, we propose to require use 
of our prescribed form for the appointment of a representative 
(currently the SSA-1696 or its electronic equivalent (e1696)). We 
expect that the use of our prescribed form will allow us to standardize 
the appointment process, facilitate the assignment of fees, and allow 
quicker processing of each appointment. Use of a prescribed process and 
form for each individual appointment will enable us to collect

[[Page 51750]]

necessary information, such as the Rep ID we issue at registration and 
fee arrangement information, with every appointment. We also would 
require a signature by all representatives, whether the representative 
is an attorney or a non-attorney.
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    \15\ See Barnhart v. Thomas, 540 U.S. 20, 29 (2003); Heckler v. 
Campbell, 461 U.S. 458, 461, n.2 (1983).
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    Additionally, under our current process, we have difficulty 
identifying individuals or processing their documents when we do not 
receive certain information at the start of the appointment. 
Considering the large number of claims that we process each year, it is 
only prudent that we require the use of a prescribed process and form, 
rather than relying on representatives to develop their own method to 
supply the information we need. In addition to the efficiencies 
discussed above, this standardized process would also minimize 
inconsistencies and reduce the need for recontacts that can cause 
delays and inconvenience. Lastly, when processing appointments under 
our current rules, technicians must confirm different requirements are 
met depending on the representative's status as an attorney or non-
attorney. Standardizing the signature requirement will improve 
efficiency by implementing a uniform rule.
    Requiring a prescribed form (e.g., the Form SSA-1696 or e1696) and 
signatures from all representatives will also strengthen uniformity in 
the processing of appointments. We would make these changes in 20 CFR 
404.1707 and 416.1507, with additional language changes to accommodate 
potential developments in the method for submitting appointments. With 
this proposed rule, we are not changing our current signature method 
requirements.

VI. Payment to Entities via EFT/Direct Deposit Only

    Currently, we collect preferences and pay individual 
representatives by check or EFT.\16\ We propose to pay entities to whom 
fees have been assigned through EFT only. Generally, EFT is the safest 
and most convenient method to receive Federal payments. It is a 
reliable, secure, fast, and contact-free method to receive payments. In 
recent years, EFT has also become increasingly popular because for most 
recipients it is more convenient than paper checks.\17\ For over a 
decade, EFT has also been required by law for Federal nontax payments, 
with limited exceptions.\18\ One of those exceptions allows agencies to 
waive the EFT requirement when the agency does not anticipate making 
payments to the same recipient on a regular, recurring basis within a 
one-year period and the recipient's financial institution does not make 
remittance data explaining the purpose of the payment readily 
available.\19\ As the Department of the Treasury explained in a 2010 
rulemaking proceeding, this exception arose to address the needs of 
individual representatives seeking fee payments from us who claimed 
that their banks were not able or willing to provide all the 
information needed to identify the client on whose account the deposit 
was made and who were precluded from electronically depositing their 
fee payments into their employer/firm's bank account.\20\ However, even 
at the time of that 2010 rulemaking, we had taken steps to begin 
transmitting information to banks to enable representatives to link 
payments to clients, and we encouraged those banks to pass that 
information on to their account holders as quickly as possible, thus 
addressing the issue of the availability of information tying payments 
to specific clients.\21\ Allowing direct payment to entities will 
resolve the representatives' concern about the inability to deposit 
their fee payments into their employer's bank account. Because we 
propose to resolve the issues that led to the waiver rule and because 
the Department of the Treasury discourages use of this waiver and 
advised that it only be used sparingly,\22\ we propose not to apply the 
waiver to entity payments.
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    \16\ See 31 CFR 208.4 (enumerating certain exceptions to the 
requirement that all non-tax payments made by Federal agencies be 
made by EFT).
    \17\ U.S. Dept. of the Treasury, Final Rule for Electronic 
Government Payment Will Balance Recipient Needs With Benefits of 
Electronic Payment (June 25, 1998), available at https://home.treasury.gov/news/press-releases/rr2560.
    \18\ See 31 U.S.C. 3332(e), (f); 31 CFR 208.1; but see 31 CFR 
208.3 and 208.4 (enumerating certain exceptions to the EFT 
requirement).
    \19\ 31 CFR 208.4(a)(6).
    \20\ See 75 FR 80315, 80325.
    \21\ Id.
    \22\ Id.
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    Further, offering check payments to entities would require changes 
to our systems that would involve significant time and resources. 
Limiting entity payments to EFT would help us ensure that our 
implementation of direct payment to entities is timely and that, upon 
the effective date of any final rule based on this proposal, we would 
begin certifying payment of fees directly to entities. The proposed 
rule would not change our current payment process or options for 
individual representatives. We would include these changes in 20 CFR 
404.1735 and 416.1535.

VII. Establishing a New Process for Appointed Representatives To 
Request Direct Payment of Authorized Fees to an Entity

    To assign direct payment of an authorized fee, the representative 
would need to: (1) be eligible for and seek direct payment; (2) be 
associated (affiliated) with the entity through our registration 
process; and (3) make the assignment timely and in the manner we 
prescribe. In addition, the entity would need to be eligible for direct 
payment as described later in this proposed rule. Where all these 
conditions are satisfied, we propose to accept or honor an assignment. 
We would check eligibility at the time we process the assignment and at 
the time we certify the direct payment. An invalid assignment would not 
affect the processing of an otherwise valid notice of appointment.
    Although we will not limit representatives to only assigning fees 
at the time of an appointment, we believe that it will be most 
efficient to collect the representative's intent to assign direct 
payment of the fee at that time. Capturing information about 
assignments during the appointment process would ensure we record each 
assignment early in the claim(s) process, help us streamline fee 
payments, allow us to automate as many fee payments as possible, and 
prevent delays and errors, all of which help us improve the timeliness 
and accuracy of our fee payment process.
    We propose to allow representatives to rescind a previously 
submitted assignment in the same manner they established it. We would 
allow a representative to withdraw an assignment by submitting an 
updated version of our prescribed form on which the representative 
deselects the assignment option, provided that the representative does 
so before the date we notify the claimant of our first favorable 
determination or decision.\23\ We would not accept any request to 
rescind an assignment after this date. Having a deadline for 
assignments and revisions to assignments also helps to ensure the 
accuracy and timeliness of our fee payments. After our decision makers 
render a favorable determination or decision, we transfer the case to 
the appropriate office for final review and payment (called 
``effectuation''). New representational documents received after the 
date we notify the claimant of a favorable determination or decision

[[Page 51751]]

will delay the effectuation process or cause inaccurate payments.
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    \23\ Throughout this preamble, ``favorable determination or 
decision'' refers to either a fully or partially favorable 
determination or decision.
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    An assignment would remain valid regardless of continued employment 
with the entity unless other reasons would invalidate the assignment. 
Some reasons to invalidate an assignment would include a 
disqualification or suspension of the representative, because an 
entity's eligibility for direct payment in a case depends on the 
representative's eligibility for direct payment; the entity becoming 
ineligible for direct payment; or the representative's timely 
rescission of the assignment, as explained above. By its own actions, 
an entity could become ineligible for direct payment, such as if it 
retains unauthorized fees or fees that exceed the amount we 
authorized,\24\ as explained more fully later in this preamble.
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    \24\ POMS GN 03920.051A.
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    We propose to reject an assignment if the representative and entity 
did not properly register prior to submission of the assignment, or if 
the representative did not properly identify the entity by providing 
the entity's name and EIN when making the assignment. We would also 
reject any assignment that was made to an entity that is ineligible for 
direct payment, that was made by a representative who is not eligible 
for or requesting direct payment of an authorized fee, or that was not 
filed before the date that we notify the claimant of our first 
favorable determination or decision. To prevent individuals from 
circumventing our direct payment and professional conduct rules, we 
would allow direct payment to entities only when the assignment is made 
by a representative eligible for direct payment.\25\ We would notify 
the representative if we rejected an assignment. The rejection of an 
assignment would not affect processing of an otherwise valid 
appointment or the representative's eligibility for direct payment.
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    \25\ 42 U.S.C. 406 and 1383; see also POMS GN 03920.017.
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    Payments to entities would be subject to all our other rules 
governing payment of fees, including the requirement that past-due 
benefits are available and that we have withheld them. If, at the time 
we calculate the fee, the assignment meets all the criteria for a valid 
assignment, we would certify payment of the authorized fee to the 
entity. However, we would not charge claimants with an overpayment to 
make direct payment to an entity in situations where, through no error 
of our own, we did not withhold funds from past-due benefits; where we 
were not timely informed of an assignment of fees; where the entity 
was, at the time of payment, ineligible for direct payment but later 
became eligible; or where the representative waived the fee, even if 
the representative withdrew the waiver, if that withdrawal occurred 
after we already made all payments and released the past-due benefits.
    We would allow only one assignment per representative per case. 
This restriction means representatives could not assign direct payment 
to multiple entities in a single case. Doing so could create confusion 
and increase the administrative burden of processing these payments. 
Additionally, allowing a representative to assign fees to multiple 
entities could lead to manual processing errors which would be contrary 
to our goal of increasing the timeliness and efficiency of our fee 
payment process. If multiple representatives involved in a case are 
affiliated with different entities, we would make fee payments 
following our existing rules for payments to multiple representatives 
and apply the rules proposed herein to qualify and fulfill each 
assignment. If all other conditions for a valid assignment are met, we 
would accept or honor the most recently updated (and timely submitted, 
as described above) request to assign a fee, which would supersede all 
prior assignment requests made by that representative. We would make 
these changes in 20 CFR 404.1730, 404.1735, 416.1530, and 416.1535.

VIII. Recovery of Excess or Erroneously Paid Fees, the Requirement To 
Name an Entity POC, and Entity Eligibility for Direct Payment

    With this proposal, we would establish a business process to ensure 
that fee errors can be corrected, consistent with our obligations to 
claimants and our stewardship obligation to protect taxpayer money. To 
facilitate resolution of fee discrepancies and other fee related 
issues, such as correcting a Form IRS-1099, we would require an entity 
to name a POC during the entity's registration. This POC would need to 
be a registered representative who is not currently suspended or 
disqualified from practicing before us. However, we would not require 
the POC to be eligible for direct payment to serve as a POC or for the 
entity to receive an assigned fee. We would collect the POC's 
information, including the POC's name, Rep ID, and phone number, during 
the entity's registration. We would reject any registration that is 
missing this information and notify the entity or representative to 
provide the missing information. To ensure consistent communication, we 
would make the POC and the entity jointly responsible for keeping this 
information current.
    We would expect the POC to assist us in resolving fee-related 
matters and to conduct all entity affairs with us with diligence, 
truthfulness, and competence. We would hold the POC responsible under 
our Rules of Conduct and Standards of Responsibility if these duties 
are not met, but we would not hold the POC financially responsible for 
repayment of excess or otherwise erroneous fee payments made directly 
to the entity. The entity would be responsible for repayment of excess 
or otherwise erroneous fees. We propose to revise our Rules of Conduct 
and Standards of Responsibility for Representatives to account for the 
new POC role in our processes. We would make these changes in 20 CFR 
404.1735, 404.1740, 416.1535, and 416.1540.

IX. Restricting Eligibility for Direct Payment for Certain Entities

    We propose to make entities ineligible for direct payment if they 
do not remit excess or otherwise erroneous fees; if they do not 
maintain an active POC; if they, through their POCs, do not assist us 
in correcting a fee payment error; or if they do not comply with our 
rules. An entity would need to update the entity registration to name a 
new POC immediately if there is any change in the current POC's status. 
This would ensure that any necessary communications regarding fees and 
fee payments would not be disrupted. We would work with the POC to 
correct possible fee inaccuracies or recover erroneous fees.
    We will maintain a list of entities that are ineligible for direct 
payment. We would place an entity on this list if that entity failed to 
resolve an excess or otherwise erroneous fee, after notice to the POC 
in our records. We would halt direct payments to any entity on this 
list and not accept new assignments from representatives made to an 
entity on this list. We would remove an entity from the list and accept 
new assignments when the entity resolves to our satisfaction the fee 
matter or other issue restricting eligibility. If the entity is 
ineligible for direct payment at the time we are ready to make direct 
payment, we will make the payment to the representative who created the 
assignment if that representative remains eligible for direct payment. 
If the representative is no longer eligible for direct payment at that 
time, we would, as we currently do, release the funds to the claimant.

[[Page 51752]]

    Establishing a process to recover fees and correct errors is 
necessary to preserve program integrity, safeguard claimants' past-due 
benefits, and ensure that we properly and efficiently manage financial 
matters with entities. We would make these changes in 20 CFR 404.1735 
and 416.1535.

X. Waivers' Effect on Direct Payment to Entities

    To avoid circumvention of our direct payment rules, as discussed 
above, representatives who waive their fee, direct payment, or both 
would not be permitted to make an assignment, since there would be no 
fee or direct payment to assign. We would not accept fee or direct 
payment waivers made by representatives who previously assigned a fee 
and did not timely rescind that assignment. Issues arising from 
untimely assignment submissions or rescissions, improper waivers, or 
similar events would be matters between the entity and the 
representative. We would make these changes in 20 CFR 404.1730 and 
416.1530.

XI. Replacing Form SSA-1695

    We previously issued a Federal Register Notice (FRN), ``Identifying 
Information For Possible Direct Payment of Authorized Fees,'' that 
required the submission of Form SSA-1695 (OMB No. 0960-0730), a now-
obsolete form that required the representatives' SSN and other 
personally identifiable information, in each case in which a 
representative sought direct payment.\26\
---------------------------------------------------------------------------

    \26\ 71 FR 58043 (Oct. 2, 2006).
---------------------------------------------------------------------------

    We have included relevant information from this collection 
instrument in the SSA-1696, while eliminating the SSN requirement. The 
2006 FRN's requirements would be obsolete if we finalize this proposal 
by publishing a final rule.
    Authority: The Commissioner of Social Security is authorized to 
make rules and regulations to carry out the provisions of the Act, 
including recognition of representatives, under sections 205(a), 
206(a)(1), 702(a)(5), 810(a), and 1631(d) of the Act.\27\
---------------------------------------------------------------------------

    \27\ 42 U.S.C. 405(a), 406(a)(2), 902(a)(5), 1010(a), and 
1383(d).
---------------------------------------------------------------------------

    Solicitation for Public Comment: As discussed elsewhere in this 
rulemaking, we are seeking public comment on this proposed rule. The 
initial impetus for this proposal was to ensure we are in compliance 
with the Marasco decision guidelines. However, as previously stated, we 
also want to use this opportunity to minimize inconsistencies and 
reduce the need for recontacts associated with the representative fee 
direct payment or appointment processes (within the scope of this 
proposed rule). Accordingly, while we encourage public comments on all 
aspects of the proposed rule, we note these comments can include 
thoughts and suggestions on other, related improvements, provided they 
are within the scope of this proposal.

Rulemaking Analyses and Notices

    We will consider all comments we receive on or before the close of 
business on the comment closing date indicated above. The comments will 
be available for examination in the rulemaking docket for these rules 
at the above address. We will file comments received after the comment 
closing date in the docket and may consider those comments to the 
extent practicable. However, we will not respond specifically to 
untimely comments. We may publish a final rule at any time after close 
of the comment period.

Clarity of This Rule

    Executive Order (E.O.) 12866, as supplemented by E.O. 13563 and 
E.O. 14094, requires each agency to write all rules in plain language. 
In addition to your substantive comments on this proposed rule, we 
invite your comments on how to make the rule easier to understand.
    For example:
     Would more, but shorter, sections be better?
     Are the requirements in the rule clearly stated?
     Have we organized the material to suit your needs?
     Could we improve clarity by adding tables, lists, or 
diagrams?
     What else could we do to make the rule easier to 
understand?
     Does the rule contain technical language or jargon that is 
not clear?
     Would a different format make the rule easier to 
understand, e.g., grouping and order of sections, use of headings, 
paragraphing?

When will we start to use this proposed rule?

    We will not use this proposed rule until we evaluate public 
comments and publish a final rule in the Federal Register. All final 
rules include an effective date. We will continue to use our current 
rules until that date. When we publish a final rule, we will include a 
summary of the significant comments we received along with responses 
and an explanation of how we will apply the new rule.

Regulatory Procedures

Executive Order 12866, as Supplemented by Executive Orders 13563 and 
14094

    We consulted with the Office of Management and Budget (OMB) and 
they determined that this proposed rule does not meet the criteria for 
a significant regulatory action under E.O. 12866, as supplemented by 
E.O. 13563 and E.O. 14094, and is not subject to OMB review.
    We also determined that this proposed rule meets the plain language 
requirement of E.O. 12866.

Anticipated Accounting Costs of This Proposed Rule

Anticipated Costs to Our Programs
    Our Office of the Chief Actuary estimates that implementation of 
these proposed rules would result in negligible changes (i.e., less 
than $500,000) in scheduled OASDI benefits and Federal SSI payments. 
This estimate is based primarily on the assumption that these proposed 
rules would not materially affect the availability and quality of 
representation.
Anticipated Administrative Costs to the Social Security Administration
    The systems upgrades necessary to comply with the Marasco decision 
are funded and currently underway. We do not expect that additional 
funding will be needed. Once the rule becomes effective, the Office of 
Budget, Finance, and Management estimates administrative costs of less 
than 15 work years and $2 million annually from the updates to our 
current business processes.

Anticipated Time-Savings and Qualitative Benefits

    Beyond complying with the Marasco decision, we also anticipate this 
proposed rule will be less burdensome and more efficient for the 
affected public. Currently, entities that employ representatives must 
spend time and effort working with those representatives so the latter 
can remit Social Security fee remuneration back to the firm. By making 
the payment directly to an entity rather than only to a representative, 
we save both the entity and the representative the time and effort they 
would have otherwise spent on completing the requisite paperwork and 
financial transactions involved in transferring funds (on the 
representative's end) and adjusting accounting records to reflect the 
transfer (on the part of the entity's accounting or bookkeeping staff). 
Ultimately, then,

[[Page 51753]]

this change will ensure a faster and more efficient process for 
representatives and the entities who employ them. This may also have 
downstream positive effects for claimants seeking representation; if 
representatives and their employing entities do not need to spend as 
much time dealing with accounting and paperwork, they could perhaps 
work on existing cases faster, or could take on more claimants to 
represent.

Executive Order 13132 (Federalism)

    We analyzed this proposed rule in accordance with the principles 
and criteria established by E.O. 13132 and determined that this 
proposed rule will not have sufficient federalism implications to 
warrant the preparation of a federalism assessment. We also determined 
that this proposed rule would not preempt any State law or State 
regulation or affect the States' abilities to discharge traditional 
State governmental functions.

Regulatory Flexibility Act

    We certify that this proposed rule will not have a significant 
economic impact on a substantial number of small entities. Although 
this proposed rule would require small entities who want to receive 
direct payment of authorized fees to provide us with certain 
information, maintain an active POC responsible for interacting with 
the agency, and accept payment by EFT, these requirements would not 
disadvantage small entities or limit their ability to compete with 
larger competitors. Additionally, this proposed rule does not place 
significant costs on entities.
    We estimate that the time required for a small entity to complete 
the one-time transaction required to fill out and submit a basic 
registration form, provide banking information, and identify a POC 
would be minimal. Once the initial registration is complete, there 
would be no additional burden on the entity unless and until the entity 
needed to update its registration information. We anticipate that small 
entities that take advantage of the opportunity to receive direct 
payment of authorized fees through the assignment process may 
experience slight cost savings because of improved accuracy and 
efficiency in their recordkeeping processes and because they would no 
longer need to collect and properly account for payments made to 
individual representative employees. Therefore, a regulatory 
flexibility analysis as provided in the Regulatory Flexibility Act, as 
amended, is not required.

Paperwork Reduction Act

    These proposed rules contain public reporting requirements. For 
some sections in these rules, we previously accounted for the public 
reporting burdens under the following OMB approved information 
collections: 0960-0527 (SSA-1696, Appointment of Representative, which 
allows an individual to appoint a representative, and requires the 
representative's agreement to serve as representative), 0960-0731 (SSA-
1694, Request for Business Entity Taxpayer Information, which requests 
specific taxpayer data from representatives requesting a fee), and 0960 
0732 (SSA-1699, Registration for Appointed Representative Services and 
Direct Payment, which requires the representatives to prove eligibility 
when they register with SSA and allows them to request a fee). 
Consequently, we are not reporting those sections below.
    The sections below pose new public reporting burdens not currently 
covered by an existing OMB-approved form; therefore, we provide burden 
estimates for them. We are seeking approval for these regulation 
sections under the revised SSA Forms SSA-1694 (0960-0731) and SSA 1696 
(OMB No. 0960-0527), which we will use to collect the information 
required by these revised sections. Below we provide burden estimates 
for the public reporting requirements we are revising:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                              Average
                                       Description  of       Number of                    Average burden     Estimated      theoretical    Total annual
        Regulation section            public reporting      respondents    Frequency of    per response    total annual     hourly cost     opportunity
                                         requirement        (annually)       response        (minutes)    burden (hours)      amount      cost (dollars)
                                                                                                                           (dollars) **         ***
--------------------------------------------------------------------------------------------------------------------------------------------------------
404.1707(a), 416.1507(a), SSA-1696  You [claimant]             1,100,000               1               7         128,333       ** $12.81  *** $1,643,946
 (0960-0527).                        complete and sign
                                     our prescribed
                                     appointment form,
                                     and
404.1707(a), 416.1507(a), SSA-1696  Your representative        1,100,000               1               5          91,667        ** 73.86   *** 6,770,525
 (0960-0527).                        completes and signs
                                     our prescribed
                                     appointment form,
                                     and
404.1720(f), 416.1520(f), SSA-1696  A representative who         500,000               1               5        * 41,667        ** 73.86   *** 3,077,525
 (0960-0527).                        is eligible for
                                     direct payment of
                                     an authorized fee
                                     may assign direct
                                     payment of the
                                     authorized fee to
                                     an entity that is
                                     eligible for direct
                                     payment.
404.1730(e)(2), 416.1530(e)(2),     A representative may         150,000               1               3           7,500        ** 73.86     *** 553,950
 SSA-1696 (0960-0527).               rescind an
                                     assignment before
                                     the date on which
                                     we notify you of
                                     our first favorable
                                     determination or
                                     decision.

[[Page 51754]]

 
404.1735, 416.1535, SSA-1694 (0960- An entity is                   7,000               1              18           2,100        ** 73.86     *** 155,106
 0731).                              eligible for direct
                                     payment if the
                                     entity:
                                    (a) has an
                                     Employment
                                     Identification
                                     Number,.
                                    (b) is registered
                                     with us in the
                                     manner we
                                     prescribe,.
                                    (c) has not been
                                     found ineligible
                                     for direct payment,.
                                    (d) designates and
                                     maintains a
                                     registered
                                     representative as a
                                     point of contact to
                                     speak and act on
                                     the entity's
                                     behalf,.
                                    (e) accepts payment
                                     via electronic
                                     transfer, and.
                                    (f) conforms to our
                                     rules..
                                                         -----------------------------------------------------------------------------------------------
    Totals........................  ....................       2,857,000  ..............  ..............         271,267  ..............  *** 12,201,052
--------------------------------------------------------------------------------------------------------------------------------------------------------
* This is not additional burden but part of the existing burden for those representatives who complete this instrument but also check the assignment
  box. We include it here to indicate a change in burden for this regulatory section.
** We based these figures on average Legal Service hourly salary, as reported by Bureau of Labor Statistics data (https://www.bls.gov/oes/current/oes231011.htm) and the average DI payments based on SSA's current FY 2023 data (https://www.ssa.gov/legislation/2023factsheet.pdf).
*** This figure does not represent actual costs that SSA is imposing on recipients of Social Security payments to complete this application; rather,
  these are theoretical opportunity costs for the additional time respondents will spend to complete the application. There is no actual charge to
  respondents to complete the application.

    SSA submitted revised Information Collection Requests under both 
OMB Numbers 0960-0527 and 0960-0731 for clearance to OMB. We are 
soliciting comments on the burden estimate; the need for the 
information; its practical utility; ways to enhance its quality, 
utility, and clarity; and ways to minimize the burden on respondents, 
including the use of automated techniques or other forms of information 
technology. If you would like to submit comments, please send them to 
the following locations:
    Office of Management and Budget, Attn: Desk Officer for SSA, Fax 
Number: 202-395-6974, Email address: [email protected].
    Social Security Administration, OLCA, Attn: Reports Clearance 
Director, Mail Stop 3253 Altmeyer, 6401 Security Blvd., Baltimore, MD 
21235, Fax: 410-966-2830, Email address: [email protected].
    You can submit comments until October 3, 2023, which is 60 days 
after the publication of this notice. However, your comments will be 
most useful if you send them to SSA by September 5, 2023, which is 30 
days after publication. To receive a copy of the OMB clearance package, 
contact the SSA Reports Clearance Officer using any of the above 
contact methods. We prefer to receive comments by email or fax.

List of Subjects

20 CFR Part 404

    Administrative practice and procedure; Blind; Disability benefits; 
Old-Age, Survivors, and Disability Insurance; Reporting and 
recordkeeping requirements; Social Security.

20 CFR Part 416

    Administrative practice and procedure; Aged, Blind, Disability 
benefits, Public assistance programs; Reporting and recordkeeping 
requirements; Supplemental Security Income (SSI).

20 CFR Part 422

    Administrative practice and procedure; Reporting and recordkeeping 
requirements; Social security.
    The Acting Commissioner of the Social Security Administration, 
Kilolo Kijakazi, Ph.D., M.S.W., having reviewed and approved this 
document, is delegating the authority to electronically sign this 
document to Faye I. Lipsky, who is the primary Federal Register Liaison 
for SSA, for purposes of publication in the Federal Register.

Faye I. Lipsky,
Federal Register Liaison, Office of Legislation and Congressional 
Affairs, Social Security Administration.

    For the reasons stated in the preamble, we propose to amend 20 CFR 
chapter III, parts 404, 416 and 422, as set forth below:

PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE 
(1950-)

Subpart R--Representation of Parties

0
1. The authority citation for subpart R of part 404 is revised to read 
as follows:

    Authority: 42 U.S.C. 405(a), 406, 902(a)(5), and 1320a-6.


0
2. In Sec.  404.1703, add definitions for ``Assignment,'' ``Point of 
Contact,'' and ``Registration'' in alphabetical order, and revise the 
definition of Representative to read as follows:


Sec.  404.1703  Definitions.

    Assignment means the transfer of the right to receive direct 
payment of an authorized fee to an entity as described in Sec.  
404.1730(e).
* * * * *
    Point of Contact means an individual who is a registered 
representative selected by an entity to speak and act on the entity's 
behalf and who assumes the affirmative duties and obligations we 
prescribe.
    Registration means a process by which a representative or entity 
provides the information we require to conduct business with us.
* * * * *
    Representative means an attorney who meets all of the requirements 
of Sec.  404.1705(a), or a person other than an attorney who meets all 
of the requirements of Sec.  404.1705(b), and whom you appoint to 
represent you in dealings with us. For purposes of our rules of conduct 
and standards of responsibility, Representative also includes an 
individual who provides representational services and an individual who 
is listed as a point of contact for an entity, as applicable to their 
identified role.
* * * * *

[[Page 51755]]


0
3. In Sec.  404.1705, redesignate paragraph (c) as paragraph (d) and 
add a new paragraph (c), and revise newly redesignated paragraph (d) to 
read as follows:


Sec.  404.1705  Who may be your representative.

* * * * *
    (c) Your representative(s) must be registered with us in the manner 
we prescribe before you submit the appointment(s).
    (d) We may refuse to recognize your chosen representative if the 
person does not meet the requirements in this section. We will notify 
you and the proposed representative if we do not recognize the person 
as your representative.


0
4. Revise Sec.  404.1707 to read as follows:


Sec.  404.1707  Appointing a representative.

    We will recognize a person as your representative if:
    (a) You and your representative complete and sign our prescribed 
appointment form, and
    (b) You or your representative file our prescribed appointment form 
in the manner we designate.


0
5. In Sec.  404.1720, add new paragraph (f) to read as follows:


Sec.  404.1720  Fee for a representative's services.

* * * * *
    (f) Assignment of fees. A representative who is eligible for direct 
payment of an authorized fee may assign the authorized fee to an entity 
that is eligible for direct payment of fees (see 404.1730(e) and 
404.1735).


0
6. In Sec.  404.1730, revise the heading of paragraph (b), revise 
paragraph (b)(1), redesignate (b)(1)(i) as (b)(1)(iii) and (b)(1)(ii) 
as (b)(1)(iv), add new paragraphs (b)(1)(i) and (b)(1)(ii), and add a 
new paragraph (e) to read as follows:


Sec.  404.1730  Payment of fees.

* * * * *
    (b) Fees we may pay--(1) Attorneys and eligible non-attorneys. 
Except as provided in paragraph (c) of this section, if we make a 
determination or decision in your favor and you were represented by an 
attorney or an eligible non-attorney (see Sec.  404.1717), and as a 
result of the determination or decision you have past-due benefits,
    (i) We will pay your representative out of the past-due benefits 
the lesser of the amounts in paragraph (b)(1)(iii) or (iv) of this 
section, less the amount of the assessment described in paragraph (d) 
of this section, unless the representative submits to us in writing a 
waiver of the fee or direct payment of the fee, and
    (ii) If there is a valid assignment (see paragraph (e) of this 
section), we will pay the representative's fee (see paragraph (b)(1)(i) 
of this section) to an entity.
* * * * *
    (e) Assignment of a fee to designated entity (1) A representative 
may assign the fee we authorize to an eligible entity if the 
representative:
    (i) Is eligible for direct payment,
    (ii) Has not waived the fee or direct payment,
    (iii) Assigns the entire fee we authorize to one entity,
    (iv) Makes the assignment before the date on which we notify you of 
our first favorable determination or decision, and
    (v) Affiliates with the entity through registration.
    (2) A representative may rescind an assignment before the date on 
which we notify you of our first favorable determination or decision.
    (3) A representative may not assign a fee to an entity that is 
ineligible to receive direct payment.
    (4) A representative may not waive a fee or direct payment of a fee 
if the representative previously assigned a fee in accordance with 
paragraph (e)(1) of this section and did not timely rescind that 
assignment in accordance with paragraph (e)(2) of this section.


0
7. Add Sec.  404.1735 to read as follows:


Sec.  404.1735  Entity eligible for direct payment of fees.

    An entity is eligible for direct payment of an authorized fee if 
the entity:
    (a) Has an Employer Identification Number,
    (b) Has registered with us in the manner we prescribe,
    (c) Has not been found ineligible for direct payment,
    (d) Designates and maintains an employee who is a registered 
representative as a point of contact to speak and act on the entity's 
behalf,
    (e) Accepts payment via electronic funds transfer, and
    Conforms to our rules.


0
8. In Sec.  404.1740, add a new paragraph (c)(15) to read as follows:


Sec.  404.1740  Rules of conduct and standards of responsibility for 
representatives.

* * * * *
    (c) * * *
    (15) While serving as a point of contact for an entity, violate 
applicable affirmative duties, engage in prohibited actions, or conduct 
dealings with us in a manner that is untruthful or does not further the 
efficient and prompt correction of a fee error.

PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND 
DISABLED

Subpart O--Representation of Parties

0
9. The authority citation for subpart O of part 416 is revised to read 
as follows:

    Authority: 42 U.S.C. 405(a), 406, 902(a)(5), and 1320a-6.


0
10. In Sec.  416.1503, add definitions for ``Assignment,'' ``Point of 
Contact,'' and ``Registration'', and revise the definition of 
``Representative'' to read as follows:


Sec.  416.1503  Definitions.

* * * * *
    Assignment means the transfer of the right to receive direct 
payment of an authorized fee to an entity as described in Sec.  
416.1530(e).
* * * * *
    Point of Contact means an individual who is a registered 
representative selected by an entity to speak and act on the entity's 
behalf and who assumes the affirmative duties and obligations we 
prescribe.
    Registration means a process by which a representative or entity 
provides the information we require to conduct business with us.
* * * * *
    Representative means an attorney who meets all of the requirements 
of Sec.  416.1505(a), or a person other than an attorney who meets all 
of the requirements of Sec.  416.1505(b), and whom you appoint to 
represent you in dealings with us. For purposes of our rules of conduct 
and standards of responsibility, Representative also includes an 
individual who provides representational services and an individual who 
is listed as a point of contact for an entity, as applicable to their 
identified role.
* * * * *

0
11. In Sec.  416.1505, redesignate paragraph (c) as paragraph (d) and 
add a new paragraph (c), and revise newly redesignated paragraph (d) to 
read as follows:


Sec.  416.1505  Who may be your representative.

* * * * *
    (c) Your representative(s) must be registered with us in the manner 
we prescribe before you submit the appointment(s).
    (d) We may refuse to recognize your chosen representative if the 
person does

[[Page 51756]]

not meet the requirements in this section. We will notify you and the 
proposed representative if we do not recognize the person as your 
representative.


0
12. Revise Sec.  416.1507 to read as follows:


Sec.  416.1507  Appointing a representative.

    We will recognize a person as your representative if:
    (a) You and your representative complete and sign our prescribed 
appointment form, and
    (b) You or your representative file our prescribed appointment form 
in the manner we designate.


0
13. In Sec.  416.1520, add new paragraph (f) to read as follows:


Sec.  416.1520  Fee for a representative's services.

* * * * *
    (f) Assignment of fees. A representative who is eligible for direct 
payment of an authorized fee may assign the authorized fee to an entity 
that is eligible for direct payment of fees (see 416.1530(e) and 
416.1535).


0
14. In Sec.  416.1530, revise the heading of paragraph (b), revise 
paragraph (b)(1), and add a new paragraph (e) to read as follows:


Sec.  416.1530  Payment of Fees.

* * * * *
    (b) Fees we may pay. (1) Attorneys and eligible non-attorneys. 
Except as provided in paragraph (c) of this section, if we make a 
determination or decision in your favor and you were represented by an 
attorney or an eligible non-attorney (see 416.1517), and as a result of 
the determination or decision you have past-due benefits,
    (i) We will pay your representative out of the past-due benefits 
the lesser of the amounts in paragraph (b)(1)(iii) or (iv) of this 
section, less the amount of the assessment described in paragraph (d) 
of this section, unless the representative submits to us in writing a 
waiver of the fee or direct payment of the fee, and
    (ii) If there is a valid assignment (see paragraph (e) of this 
section), we will pay the representative's fee (see paragraph (b)(1)(i) 
of this section) to an entity.
* * * * *
    (e) Assignment of a fee to designated entity (1) A representative 
may assign the fee we authorize to an eligible entity if the 
representative:
    (i) Is eligible for direct payment,
    (ii) Has not waived the fee or direct payment,
    (iii) Assigns the entire fee we authorize to one entity,
    (iv) Makes the assignment before the date on which we notify you of 
our first favorable determination or decision, and
    (v) Affiliates with the entity through registration.
    (2) A representative may rescind an assignment before the date on 
which we notify you of our first favorable determination or decision.
    (3) A representative may not assign a fee to an entity that is 
ineligible to receive direct payment.
    (4) A representative may not waive a fee or direct payment of a fee 
if the representative previously assigned a fee in accordance with 
paragraph (e)(1) of this section and did not timely rescind that 
assignment in accordance with paragraph (e)(2) of this section.


0
15. Add Sec.  416.1535 to read as follows:


Sec.  416.1535  Entity eligible for direct payment of fees.

    An entity is eligible for direct payment of an authorized fee if 
the entity:
    (a) Has an Employer Identification Number
    (b) Has registered with us in the manner we prescribe,
    (c) Has not been found ineligible for direct payment,
    (d) Designates and maintains an employee who is a registered 
representative as a point of contact to speak and act on the entity's 
behalf,
    (e) Accepts payment via electronic funds transfer, and
    Conforms to our rules.


0
16. In Sec.  416.1540, add a new paragraph (c)(15) to read as follows:


Sec.  416.1540  Rules of conduct and standards of responsibility for 
representatives.

* * * * *
    (c) * * *
    (15) While serving as a point of contact for an entity, violate 
applicable affirmative duties, engage in prohibited actions, or conduct 
dealings with us in a manner that is untruthful or does not further the 
efficient and prompt correction of a fee error.

PART 422--ORGANIZATION AND PROCEDURES

Subpart F--Applications and Related Forms

0
17. The authority citation for subpart F of part 422 is revised to read 
as follows:

    Authority: 42 U.S.C. 1320b-10(a)(2)(A).


0
18. In Sec.  422.515, revise the designation of form SSA-1696 to read 
as follows:


Sec.  422.515  Forms used for withdrawal, reconsideration and other 
appeals, and appointment of representative.

* * * * *
    SSA-1696--Claimant's Appointment of Representative. (For use by 
claimants or representatives as a notice of their appointment of a 
representative in a claim, issue, or other matter that is pending a 
determination or a decision before the agency).
* * * * *
[FR Doc. 2023-16405 Filed 8-3-23; 8:45 am]
BILLING CODE 4191-02-P