Since passage of the Debt Collection Improvement Act in 1996 the government has been working toward electronic delivery of all government checks. Plans have now been finalized for the phasing out of paper checks to social security recipients. It is expected that the changes will save Social Security over $1 billion dollars over the next ten years.
Under the plan, those applying for benefits on or after May 1, 2011 will be required to receive electronic payments through direct deposit. Those that don't have a bank account or prefer using a credit card have the option of using a prepaid Direct Express Debit MasterCard account which is issued by Comerica Bank. Acccording to government sources the account is structured in such a way that it may be used at no cost to the recipient.
Those currently enrolled will need to switch to an electronic payment option by March1, 2013. Current check receiving recipients over the age of 90 are exempt from the requirement and may continue receiving paper checks if they choose.
In a related rule, the Treasury Department is expected in 2011 to protect benefit payments from garnishment after they are electronically deposited.
To promote the new rules and ease in the transition the government has set up a website at: http://www.godirect.org/
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