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Treasury Reclamation After an Accountholder's Death

9/29/2026

When a customer who receives Social Security dies, the benefit deposits do not stop right away. The payment arriving the month after death has to go back, and often one or two more arrive before the agency's records catch up. By the time Treasury asks for the money, a surviving spouse or adult child may have spent it. The federal rule for who pays in that case is 31 CFR Part 210, Subpart B, and it puts the bank in the middle. A bank that knows the rules and answers a reclamation notice correctly can limit its liability. A bank that misses the deadline pays the full amount, and that debit is final.

This post walks through Social Security reclamation and federal benefit reclamation from the receiving bank's side: why the rules exist, what counts as knowing about a death, what to do before a reclamation notice arrives, how to respond to one, and how the liability math works. Sources are 31 CFR Part 210 and the Bureau of the Fiscal Service's Green Book, the Treasury's guide to federal ACH payments. Both are public, and your operations staff should be working from the current versions.

Why Reclamation Exists

Two facts create the problem.

First, benefits are not payable for the month of death. The Social Security Administration cannot pay benefits for the month a recipient dies, and because Social Security pays a month behind, the deposit received the following month is the payment for the month of death. That deposit and any later ones have to be returned.

Second, once a payment is credited, it belongs to the account holder. The Green Book explains that once a federal payment is credited to the recipient's account, it becomes the property of the account holder. After death, that means a joint owner or the decedent's estate. The government cannot legally direct the bank to take funds already credited and return them.

Part 210 solves this by making the bank, as the receiving depository financial institution (RDFI), liable to the government for post-death benefit payments, and then letting the bank limit that liability if it meets specific conditions. By accepting federal benefit payments, the bank agrees to the rules and authorizes Treasury to debit its Federal Reserve account (31 CFR 210.9).

Full Liability Is the Starting Point

Under 31 CFR 210.10(a), a bank is liable for the total amount of all benefit payments received after the death or legal incapacity of a recipient, unless it qualifies to limit its liability under §210.11. The same section requires the bank to:

  • Return any benefit payment received after it becomes aware of the death, however it learned of it.
  • Notify the paying agency immediately if it learned of the death from some source other than the agency. Returning the payment with ACH return reason code R15 (beneficiary or account holder deceased) or R14 (representative payee deceased) counts as that notice.

Limited liability is the exception, and it depends entirely on what the bank knew and when, and on how well it responds.

What Counts as Knowing About a Death

Part 210 uses actual or constructive knowledge. Under 31 CFR 210.10(b), it means the bank received information of the death by any means and had a reasonable opportunity to act on it, or that the bank would have learned of the death if it had followed commercially reasonable business practices.

The Green Book lists ways a bank may learn of a death. Each of them starts the clock:

  • A Death Notification Entry (DNE), the zero-dollar ACH entry federal agencies send to report a death. The Green Book says SSA, OPM and the Railroad Retirement Board currently originate DNEs.
  • Receipt of a Notice of Reclamation itself
  • Any contact or withdrawal request from an executor, administrator, personal representative or other estate representative. The Green Book says any release to a party clearly acting for the deceased person or the estate will be treated as showing that the bank knew of the death.
  • A relevant reference to or from a probate court, a funeral home or letters testamentary
  • A credible oral or written report of the death
  • Credible death information found during a dormant account inquiry or other internal screening
  • Credible personal awareness of the death by bank staff
  • A credible death notice received in the mail

Two points make this harder in practice. Knowledge anywhere in the bank is knowledge for the bank. A teller who hears about a death from a family member, a loan officer who gets a probate notice and a safe deposit clerk who drills a box all create knowledge. And according to the Green Book, notice of a death from any source covers all federal benefit payments to that recipient, from every agency.

That is why a deceased-accountholder procedure needs a single intake point. A death learned anywhere in the bank has to reach whoever handles federal benefit returns, not sit in a branch note.

Before Any Notice Arrives: Returning Payments

Once the bank knows of the death, the rules for incoming payments are strict.

Return post-death benefit payments as they arrive, using R15 or R14. Under 31 CFR 210.10, those returns also serve as the bank's notice to the agency. The Green Book asks that the date of death in the return addenda be in YYMMDD format.

Do not hold them. The Green Book says a bank should never hold benefit payments indefinitely in a suspense account or by any other means. Doing so may breach the bank's warranty under Part 210 and can cost the bank its ability to limit liability.

Flag carefully on joint accounts. The Green Book's example is a joint account flagged after one spouse's death, which then caused the surviving spouse's own survivor benefits to be returned as R15. The agency then terminated the living spouse's benefits. The fix is to flag by the deceased person's name or SSN, not the account, or have the survivor open a new account with a new direct deposit enrollment.

Payments already credited are a policy decision. The Green Book is explicit that Fiscal Service does not authorize or direct banks to debit a recipient's account, including to return post-death payments already credited before the bank learned of the death. Some banks voluntarily analyze the account and return those payments before any notice, and Fiscal Service will accept such returns if made electronically with R14 or R15. Whether your bank can do that is a question of your deposit contract and state law, and 31 CFR 210.12 says exactly that. Set the policy in advance with counsel. Don't leave it to whoever opens the death certificate.

The Notice of Reclamation

If post-death payments were credited and not returned, the agency initiates a reclamation, and the bank receives a Notice of Reclamation, FS Form 133.

The first business day

The Green Book says the bank has up to one business day after receiving the notice to determine the account balance and, if the deposit contract allows, prevent further withdrawals of post-death benefit payments. The balance at that point is the figure the limited-liability calculation uses.

The 60-day response

The bank has up to 60 calendar days from the issue date of the notice to provide a full and accurate response. The Green Book says responses go through the Automated Reclamation Processing System (ARPS) on Pay.gov, with narrow exceptions. If no response arrives within 30 days, a follow-up notice, FS Form 2942, is sent, and the response must then be received within 30 days of the follow-up notice. Otherwise the bank loses its right to limit liability. Failure to respond in time can result in a debit to the bank's Federal Reserve account, or its correspondent's, for the full amount, and that debit is final.

Notice to the account owners

Under 31 CFR 210.13, on receiving a notice of reclamation the bank must immediately mail or otherwise provide the account owners a copy of any notice the Service requires, as specified in the Green Book. The FS Form 133 includes an account owner copy for this purpose. Fiscal Service may require proof that the notice was sent, so keep it.

Limiting Liability

The conditions

Under 31 CFR 210.11(b), to limit its liability the bank must:

  1. Certify that it had no actual or constructive knowledge of the death when the benefit payments were credited to or withdrawn from the account
  2. Certify the date it first had knowledge of the death, however it was obtained
  3. Provide the name, last known address and phone number from its records of the recipient and any co-owners, everyone else authorized to withdraw from the account, and everyone who withdrew funds after the death, or certify that the information is not available and why
  4. Fully and accurately complete all certifications on the notice and otherwise comply with Part 210

The third item is where many responses fall apart. Identifying who withdrew funds after death means reviewing checks, debit card transactions, ATM withdrawals, transfers and online banking activity, and connecting them to people. A bank that cannot do that within 60 days does not qualify.

The calculation

If the bank qualifies, 31 CFR 210.11(a) limits its liability to:

  • The lesser of the account balance when it received the notice and had a reasonable opportunity to act (not more than one business day), plus any later benefit payments credited before it responds in full, or the outstanding total of post-death payments; plus
  • If the agency cannot collect the rest, the lesser of the benefit payments received within 45 days after the death, or the remaining balance of the outstanding total

The bank returns the first amount right away. The agency then tries to collect the rest from the withdrawers the bank identified. The Green Book says agencies have up to three years from the date of the FS Form 133 to submit final debit requests against the bank for the 45-day amount.

A worked example

A customer dies on March 10. Four monthly Social Security payments of $1,500 arrive after the death, in April, May, June and July, before the agency stops them. The outstanding total is $6,000. Only the April payment arrives within 45 days of death. When the notice of reclamation arrives, the account holds $1,800. The bank had no knowledge of the death until the notice came.

  • The bank qualifies and returns $1,800 (less than the $6,000 outstanding total).
  • The agency pursues the remaining $4,200 from the people who withdrew it.
  • If the agency cannot collect, the bank is debited the lesser of the 45-day amount ($1,500) or the remaining balance ($4,200), so $1,500.

The bank's maximum exposure is $3,300. If it misses the 60-day deadline or cannot identify the withdrawers, it can be debited the full $6,000.

Time Limits on the Government

Part 210 limits the government too, and those limits are worth checking on every notice:

  • 120 days to initiate. Under 31 CFR 210.10(d), an agency must initiate a reclamation within 120 calendar days after it first had actual or constructive knowledge of the death. The Green Book describes filing a 120-day protest through the electronic form in ARPS.
  • Six-year lookback. An agency may not reclaim a post-death payment made more than six years before the notice, unless the account balance when the notice is received exceeds the total of post-death payments in that six-year period. In that case, the bank is liable for all post-death payments up to the account balance.
  • Wrong date of death. Under 31 CFR 210.14, if the bank learns after responding that the recipient is alive or the date of death is wrong, it notifies the agency, which resolves the dispute and returns any improperly reclaimed funds.

There is also a narrow exception in 31 CFR 210.10(c): a bank is not liable for post-death payments sent to a recipient acting as a representative payee or fiduciary for a beneficiary, if the beneficiary was already dead when the payment authorization was signed and the bank did not know it.

Recovering From the Customer

Under 31 CFR 210.12, Part 210 does not authorize the bank to debit the recipient's account. Whether the bank can recover a reclamation loss from the account, a joint owner or the estate depends on state law and the deposit contract. Whatever the bank recovers, its liability to the government is unchanged. Many deposit agreements include a reclamation recovery clause, so make sure yours does and that it has been reviewed recently.

Survivors sometimes say they already repaid the agency. The Green Book says the bank should get a copy of the check, front and back, or a receipt from the agency. If a notice still arrives, the bank must still respond in ARPS within 60 days, and it is not liable for amounts already repaid.

Closing a Deceased Person's Bank Account With Federal Benefits

When closing a deceased person's bank account that received federal benefits, the reclamation steps belong in the same checklist as ownership and payout:

  1. Record the date of death from the certified death certificate.
  2. Identify every federal benefit deposit after that date, from every agency.
  3. Return any payment received after the bank learned of the death with R15 or R14.
  4. Apply your board-approved policy on already-credited post-death payments before releasing funds.
  5. Do not pay out post-death benefits to a survivor, beneficiary, affiant or personal representative as if they were the account's money.
  6. Keep records of who could withdraw, and who did, from the date of death onward. You will need them for a notice.
  7. Route every Notice of Reclamation to one trained team with the 60-day deadline tracked.

Related federal benefit rules are easy to confuse with reclamation. The garnishment rule at 31 CFR Part 212 protects certain federal benefits from garnishment orders. It is a separate regime with its own procedures, covered in Federal Benefit Payment Garnishment Rule (FFIEC) and our post on account garnishments and levies. For the broader ACH context, see our ACH training page and the post on ACH fraud.

Training the People Who Touch Death Notices

Reclamation losses rarely come from the reclamation team. They come from a branch that released funds to an executor without telling anyone, a joint account flagged the wrong way, or a death certificate that sat in a drawer. The fix is training across the deposit side on what counts as knowledge and where death information has to go. Deposit Accounts and Services is the course for frontline and deposit operations staff who handle accounts through a customer's death, and our signature card requirements post covers the ownership questions that come up at the same time.

Frequently Asked Questions

What is Social Security reclamation?

It is the process Treasury uses to recover Social Security and other federal benefit payments deposited after a recipient's death. Because benefits are not payable for the month of death, the payment received the following month and any later ones must be returned. If they were credited and not returned, the paying agency initiates a reclamation, and the bank receives a Notice of Reclamation, FS Form 133. The rules are in 31 CFR Part 210, Subpart B.

How long does a bank have to respond to a Notice of Reclamation?

Up to 60 calendar days from the notice's issue date, through the Automated Reclamation Processing System on Pay.gov, with narrow exceptions. The bank also has up to one business day after receiving the notice to determine the account balance and, where the contract allows, prevent further withdrawals of post-death payments. Missing the deadline can mean a final debit of the full amount from the bank's Federal Reserve account.

What is the 45-day rule in reclamation?

If a bank qualifies for limited liability and the agency cannot collect the remaining post-death payments from the people who withdrew them, the bank is debited the lesser of the benefit payments it received within 45 days after the death or the remaining outstanding total. This is in addition to the account balance the bank returns on receiving the notice. Agencies have up to three years from the notice to submit those final debits.

Can a bank debit the deceased customer's account to repay Treasury?

Part 210 does not authorize or direct the bank to debit the recipient's account. Whether the bank can recover from the account, a joint owner or the estate depends on state law and the deposit agreement. The Fiscal Service will accept electronic R14 or R15 returns of post-death payments made before a notice, but the decision to take credited funds is the bank's, made under its own contract and legal advice.

What counts as the bank knowing about a death?

Actual or constructive knowledge means the bank received information of the death by any means and had a reasonable opportunity to act, or would have learned of it by following commercially reasonable practices. Examples include a Death Notification Entry, a request from an executor, a probate or funeral home notice, a credible report from family, dormant account research and staff awareness. Knowledge anywhere in the bank counts for the whole bank.

Does the government have a time limit for reclamation?

Yes. The agency must initiate a reclamation within 120 calendar days after it first had actual or constructive knowledge of the death, and the bank can protest a late reclamation in ARPS. The agency also cannot reclaim payments made more than six years before the notice, unless the account balance at the time of the notice exceeds the post-death payments made in those six years.