[Federal Register Volume 62, Number 20 (Thursday, January 30, 1997)]
[Proposed Rules]
[Pages 4494-4497]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-2315]


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SOCIAL SECURITY ADMINISTRATION

20 CFR Part 404

RIN 0960-AE30


Application of State Law in Determining Child Relationship

AGENCY: Social Security Administration (SSA).

ACTION: Proposed rule.

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SUMMARY: We are proposing to revise our rules on determining whether a 
natural child has inheritance rights under appropriate State law and 
therefore may be entitled to Social Security benefits as the child of 
an insured worker. Specifically, we propose to revise our rules to 
explain which version of State law we will apply, depending on whether 
the insured is living or deceased, how we will apply State law 
requirements on time limits for determining inheritance rights, and how 
we will apply State law requirements for a court determination of 
paternity. We are also proposing to clarify our current rule on 
determining an applicant's status as a legally adopted child of an 
insured individual.

DATES: Your comments will be considered if we receive them no later 
than March 31, 1997.

ADDRESSES: Comments should be submitted in writing to the Commissioner 
of Social Security, P.O. Box 1585, Baltimore, MD 21235, sent by telefax 
to (410) 966-2830, sent by E-mail to ``[email protected],'' or 
delivered to the Division of Regulations and Rulings, Social Security 
Administration, 3-B-1 Operations Building, 6401 Security Boulevard, 
Baltimore, MD 21235, between 8:00 a.m. and 4:30 p.m. on regular 
business days. Comments received may be inspected during these same 
hours by making arrangements with the contact person shown below.

FOR FURTHER INFORMATION CONTACT: Lois Berg, Legal Assistant, Division 
of Regulations and Rulings, Social Security Administration, 3-B-1 
Operations Building, 6401 Security Boulevard, Baltimore, MD 21235, 
(410) 965-1713.

SUPPLEMENTARY INFORMATION:

Time for Determining Relationship of Natural Child

    Section 216(h)(2)(A) of the Social Security Act (the Act) states in 
part that in determining whether an applicant is the child of a 
deceased insured individual, the Commissioner shall apply such law as 
would be applied in determining the devolution of intestate personal 
property by the courts of the State in which the insured individual was 
domiciled at the time of his or her death. A child of a valid marriage 
has inheritance rights under the laws of all States.
    When determining the relationship of an illegitimate child to a 
deceased insured person under section 216(h)(2)(A), we have always 
looked to the law that was in effect in the insured's State of domicile 
at the time he or she died. Some Federal courts have also interpreted 
the provision this way. See Schaefer on behalf of Schaefer, 792 F.2d 81 
(7th Cir. 1986); Ramon v. Califano, 493 F. Supp. 158 (W.D. Tex. 1980); 
and Allen v. Califano, 452 F. Supp. 205 (D. Md. 1978).
    Other courts have adopted different interpretations. For example, 
in Owens v. Schweiker, 692 F.2d 80 (9th Cir. 1982), the court held that 
section 216(h)(2)(A) should be read to require the use of the State law 
of domicile that was in effect at the time of the Secretary's 
determination on the child's claim. We, therefore, published a final 
rule (49 FR 21512) on May 22, 1984, amending Sec. 404.354 of our 
regulations to clarify and reinforce our policy on applying State 
inheritance laws. However, after we amended our regulations, we also 
published Acquiescence Ruling (AR) 86-17(9) to clarify that we would 
apply the Owens decision to claims of children residing in the 9th 
Circuit. (When these

[[Page 4495]]

proposed regulations are published as final rules, we will rescind AR 
86-17(9).)
    Still other courts have held that the relevant law is the law in 
force at the time the child applies for benefits (see Cox on behalf of 
Cox v. Schweiker, 684 F.2d 310 (5th Cir. 1982); and Hart by and through 
Morse v. Bowen, 802 F.2d 1334 (11th Cir. 1986)).
    Recognizing that the language in section 216(h)(2)(A) could be 
viewed as ambiguous and has not been interpreted the same by all 
courts, we are proposing to amend our policy as stated in 
Sec. 404.354(b). We believe that a policy that permits us to apply any 
of several potentially applicable State inheritance laws would best 
effectuate Congress' intent with regard to serving the interests of 
surviving illegitimate children. Therefore, when the insured is 
deceased, we propose to determine the status of his or her illegitimate 
child by applying the State inheritance law that is in effect when we 
adjudicate the child's claim for benefits. If the child does not have 
inheritance rights under that version of State law, we will apply the 
State law that was in effect when the insured died, or any version of 
State law in effect from the time the child first could be entitled to 
benefits based on his or her application until the time we make our 
final decision on the claim, whichever version is more beneficial to 
the child.
    We also explain in these proposed regulations how we will determine 
which law was in effect as of the date of death. First we will look to 
the inheritance law that was in effect on the date of the insured's 
death. Then, if a law enacted after the insured's death is retroactive 
to the date of his or her death, we will apply that law. However, if a 
law in effect at the time of death was later declared unconstitutional, 
we will apply the State law which superseded the unconstitutional law.
    Regarding the child of a living insured worker, our current rule in 
Sec. 404.354(b) provides that the Commissioner of Social Security (the 
Commissioner) will apply the inheritance law that was in effect when 
the child's claim was filed. We are proposing to amend Secs. 404.354 
and 404.355 to clarify that we will look to the versions of State 
inheritance laws that were in effect from the first month for which the 
child could be entitled to benefits up to and including the time of our 
final decision and we will apply the version most beneficial to the 
child.

State Law Time Limits

    As previously stated, section 216(h)(2)(A) of the Act provides 
that, in determining whether an applicant is the child of a deceased 
insured individual, the Commissioner shall apply such law as would be 
applied in determining the devolution of intestate personal property by 
the courts of the State in which the insured individual was domiciled 
at the time of his or her death. That section further states that an 
applicant who, according to such law, would have the same status 
relative to taking intestate personal property as a child or parent 
shall be deemed such respective child or parent.
    Many State laws impose time limits on when someone must act to 
establish paternity for purposes of intestate succession. Such time 
limits are intended to provide for an orderly and expeditious 
settlement of estates. Since this is not the purpose of Social Security 
benefits for children, we provide in these proposed regulations that we 
will not apply a State's time limits relative to the time at which a 
child's relationship must be established when we determine the child's 
status under section 216(h)(2)(A). Not applying time limits is 
consistent with our belief that such a policy on applying State 
inheritance laws will best serve the interests of the children Congress 
sought to protect when it enacted section 216(h)(2)(A) of the Act.

Court Order Requirements

    Some State laws require a court determination of paternity for an 
illegitimate child to have inheritance rights. In determining a child's 
status under section 216(h)(2)(A), our policy has been to require that 
a claimant submit a court determination of paternity if one is required 
under State inheritance law. However, we propose to revise this policy 
by stating in these rules that in a State that requires a court 
determination of paternity, we will use the standard of proof that the 
State court would use as the basis for such a determination, but we 
will not actually require a determination by a State court. Of course, 
if a State court with jurisdiction over the matter declares that a 
child can take a child's share of an insured individual's estate 
through intestacy, or if a State court determines a child's paternity 
and such determination would prevail in that State's intestacy 
proceedings, SSA could generally rely on such State court findings. So, 
while we will not require an applicant to obtain a State court's 
determination, we will be guided by such determinations that an 
applicant has obtained, subject to the prerequisites stated in Social 
Security Ruling 83-37c for accepting State court determinations. Those 
prerequisites are: (1) an issue in a claim for Social Security benefits 
previously has been determined by a State court of competent 
jurisdiction; (2) this issue was genuinely contested before the State 
court by parties with opposing interests; (3) the issue falls within 
the general category of domestic relations law; and (4) the resolution 
by the State trial court is consistent with the law enunciated by the 
highest court in the State.
    If we evaluate paternity by using the same standards that the 
appropriate State court would use if the issue were properly before it, 
we believe we will satisfy the intent of section 216(h)(2)(A) that we 
apply ``such law as would be applied'' by the State court to determine 
inheritance rights. We believe that the requirement of section 
216(h)(2)(A) to apply State law will be satisfied if we apply the same 
substantive standard as a State court would apply to determine 
paternity.

Legally Adopted Child

    The provisions for paying benefits to children of an insured 
individual were added to the Act by the Social Security Act Amendments 
of 1939 (Public Law 76-379). Our policy for determining whether an 
applicant qualifies as the ``child'' of an insured individual has 
always been that we apply State law on inheritance rights to determine 
the status under the Act of a natural child, i.e., biological child, 
and State law on adoption to determine the status of a child legally 
adopted by the insured. To avoid any uncertainty about our policy, we 
are proposing to amend our regulations to state more clearly how we 
determine a child's status as an individual's natural child or adopted 
child.
    Section 202(d)(1) of the Act provides for benefits to a child as 
defined in section 216(e) of the Act. Section 216(e) states, in part, 
that the term ``child'' means the child or legally adopted child of an 
individual. Section 216(e) further states the requirements for a person 
to be deemed the legally adopted child of a deceased individual. 
Section 216(e) thus distinguishes between a natural child and an 
adopted child.
    Further, section 216(h)(2)(A) provides that the status of an 
applicant for benefits as a child (as opposed to a legally adopted 
child, a stepchild, or other type of individual who can qualify under 
section 216(e) of the Act as a ``child'' for purposes of section 202(d) 
of the Act) is determined by applying the law on devolution of 
intestate personal property that would be applied by the courts in the 
State of the insured individual's domicile. This is a test for the 
status of a natural child only.

[[Page 4496]]

    The legislative history of sections 216(e) and 216(h)(2)(A) shows 
that Congress intended us to use section 216(h)(2)(A) to determine the 
status of natural children only. Section 209(k), enacted in 1939, 
provided the first definition of ``child'' by stating in part that the 
term means the child of an individual, the stepchild of an individual, 
and a child legally adopted by an individual before he or she attained 
age 60 and prior to the beginning of the twelfth month before the month 
in which he or she died. Section 209(m), also enacted in 1939, 
contained language that is the same as the present section 216(h)(2)(A) 
and described how we determine whether an applicant is the ``child'' of 
the insured individual.
    Then in 1946, Congress amended section 209(k) to allow some 
children adopted by individuals aged 60 or older to receive benefits. 
Congress' explanation of the amended section 209(k) was that under 
existing provisions of the Act, a stepchild or an adopted child is not 
a ``child'' for benefit purposes unless certain conditions are met. 
H.R. Rep. No. 2526, 79th Cong., 2d Sess. 26 (1946); S. Rep. No. 1862, 
79th Cong., 2d Sess. 34 (1946). Thus, since the first provision for 
paying benefits to children of an insured worker, there has been a 
clearly defined distinction between natural children and adopted 
children and clearly defined conditions for determining the status of 
an adopted child, which conditions are not affected by section 
216(h)(2)(A).
    Along with the structure of the Act and the legislative history of 
provisions defining ``child,'' we have consistently interpreted the 
State intestacy law provisions of section 216(h)(2)(A) as not applying 
to children legally adopted by the insured individual. Our first 
regulation on the status of a child was published in 1940. That 
regulation defined a ``child'' as a son or daughter (by blood) of a 
wage earner and then went on to define ``adopted children.'' 5 FR 1880 
(May 21, 1940). We have maintained that position from the first 
regulation to the present. In the present Sec. 404.354, we state that a 
child may be related to the insured as a natural child, legally adopted 
child, stepchild, grandchild, stepgrandchild, or equitably adopted 
child. In Sec. 404.355, we explain the conditions for eligibility as a 
natural child, which include applying State inheritance law, and in 
Sec. 404.356 we state the requirement for eligibility as a legally 
adopted child.
    In these proposed regulations, we are amending Sec. 404.356 to 
explicitly provide that we will determine an applicant's status as a 
legally adopted child by applying the adoption laws of the State or 
foreign country where the adoption took place.

Addition of Northern Mariana Islands

    Further, we are proposing to add the Northern Mariana Islands to 
the names of entities whose laws we will use to determine a child's 
relationship to the insured individual, depending on his or her 
permanent home.

Electronic Versions

    The electronic file of this document is available on the Federal 
Bulletin Board (FBB) at 9:00 a.m. on the date of publication in the 
Federal Register. To download the file, modem dial (202) 512-1387. The 
FBB instructions will explain how to download the file and the fee. 
This file is in WordPerfect and will remain on the FBB during the 
comment period.

Regulatory Procedures

Executive Order 12866

    We have consulted with the Office of Management and Budget (OMB) 
and determined that these proposed rules do not meet the criteria for a 
significant regulatory action under Executive Order 12866. Thus, they 
were not subject to OMB review.

Regulatory Flexibility Act

    We certify that these proposed regulations will not have a 
significant economic impact on a substantial number of small entities 
because they affect only individuals. Therefore, a regulatory 
flexibility analysis as provided in Public Law 96-354, the Regulatory 
Flexibility Act, is not required.

Paperwork Reduction Act

    These proposed regulations impose no additional reporting or 
recordkeeping requirements necessitating clearance by OMB.

(Catalog of Federal Domestic Assistance Program Nos. 96.001 Social 
Security-Disability Insurance; 96.002 Social Security-Retirement 
Insurance; 96.004 Social Security-Survivors Insurance)

List of Subjects in 20 CFR Part 404

    Administrative practice and procedure, Blind, Disability benefits, 
Old-age, Survivors and Disability Insurance, Reporting and 
recordkeeping requirements, Social security.

    Dated: January 17, 1997.
Shirley S. Chater,
Commissioner of Social Security.
    For the reasons set out in the preamble, we are proposing to amend 
subpart D of part 404 of chapter III of title 20 of the Code of Federal 
Regulations as set forth below.

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

Subpart D--[Amended]

    1. The authority citation for subpart D of part 404 continues to 
read as follows:

    Authority: Secs. 202, 203 (a) and (b), 205(a), 216, 223, 225, 
228(a)-(e), and 702(a)(5) of the Social Security Act (42 U.S.C. 402, 
403 (a) and (b), 405(a), 416, 423, 425, 428(a)-(e), and 902(a)(5)).

    2. Section 404.354 is revised to read as follows:


Sec. 404.354  Your relationship to the insured.

    You may be related to the insured person in one of several ways and 
be entitled to benefits as his or her child, i.e., as a natural child, 
legally adopted child, stepchild, grandchild, stepgrandchild, or 
equitably adopted child. For details on how we determine your 
relationship to the insured person, see Secs. 404.355 through 404.359.
    3. Section 404.355 is revised to read as follows:


Sec. 404.355  Who is the insured's natural child?

    (a) Eligibility as a natural child. You may be eligible for 
benefits as the insured's natural child if one of the following 
conditions is met:
    (1) You could inherit the insured's personal property as his or her 
natural child under State inheritance laws, as described in paragraph 
(b) of this section.
    (2) You are the insured's natural child and the insured and your 
mother or father went through a ceremony which would have resulted in a 
valid marriage between them except for a ``legal impediment'' as 
described in Sec. 404.346(a).
    (3) You are the insured's natural child and your mother or father 
has not married the insured, but the insured has either acknowledged in 
writing that you are his or her child, been decreed by a court to be 
your father or mother, or been ordered by a court to contribute to your 
support because you are his or her child. If the insured is deceased, 
the acknowledgment, court decree, or court order must have been made or 
issued before his or her death. To determine whether the conditions of 
entitlement are met throughout the first month as stated in 
Sec. 404.352(a), the written acknowledgment, court decree, or court 
order will be considered to have occurred on the first day of the month 
in which it actually occurred.

[[Page 4497]]

    (4) Your mother or father has not married the insured but you have 
evidence other than the evidence described in paragraph (a)(3) to show 
that the insured is your natural father or mother. Additionally, you 
must have evidence to show that the insured was either living with you 
or contributing to your support at the time you applied for benefits. 
If the insured is not alive at the time of your application, you must 
have evidence to show that the insured was either living with you or 
contributing to your support when he or she died. See Sec. 404.366 for 
an explanation of the terms ``living with'' and ``contributions for 
support.''
    (b) Use of State Laws--(1) General. To decide whether you have 
inheritance rights as the natural child of the insured, we use the law 
on inheritance rights that the State courts would use to decide whether 
you could inherit a child's share of the insured's personal property if 
the insured were to die without leaving a will. If the insured is 
living, we look to the laws of the State where the insured has his or 
her permanent home when you apply for benefits. If the insured is 
deceased, we look to the laws of the State where the insured had his or 
her permanent home when he or she died. If the insured's permanent home 
is not or was not in one of the 50 States, the Commonwealth of Puerto 
Rico, the Virgin Islands, Guam, American Samoa, or the Northern Mariana 
Islands, we will look to the laws of the District of Columbia. For a 
definition of permanent home, see Sec. 404.303. For a further 
discussion of the State laws we use to determine whether you qualify as 
the insured's natural child, see paragraphs (b)(3) and (b)(4) of this 
section. If these laws would permit you to inherit the insured's 
personal property as his or her child, we will consider you the child 
of the insured.
    (2) Standards. We will not apply any State inheritance law 
requirement that an action to establish paternity must be taken within 
a specified period of time measured from the worker's death or the 
child's birth, or that an action to establish paternity must have been 
started or completed before the worker's death. If applicable State 
inheritance law requires a court determination of paternity, we will 
not require that you obtain such a determination but will decide your 
paternity by using the standard of proof that the State court would use 
as the basis for a determination of paternity.
    (3) Insured is living. If the insured is living, the inheritance 
laws that we use are those that are in effect in the State where the 
insured has his or her permanent home when we make our final decision 
on your application for benefits. We will apply the version of State 
law in effect when we make that decision. If you do not qualify as a 
child of the insured under that version of State law, we look at all 
versions of State law that were in effect from the first month for 
which you could be entitled to benefits up until the time of our final 
decision and apply the version of State law that is most beneficial to 
you.
    (4) Insured is deceased. If the insured is deceased, we apply the 
law of the State where the insured had his or her permanent home when 
he or she died. We apply the version of State law in effect when we 
make our final decision on your application for benefits. If you do not 
qualify as a child of the insured under that version of State law, we 
will apply the version of State law that was in effect at the time the 
insured died, or any version of State law in effect from the first 
month for which you could be entitled to benefits up until our final 
decision on your application. We will apply whichever version is most 
beneficial to you. We use the following rules to determine the law in 
effect as of the date of death:
    (A) If a State inheritance law enacted after the insured's death 
indicates that the law would be retroactive to the time of death, we 
will apply that law; or
    (B) If the inheritance law in effect at the time of the insured's 
death was later declared unconstitutional, we will apply the State law 
which superseded the unconstitutional law.
    4. Section 404.356 is amended by adding a sentence at the end to 
read as follows:


Sec. 404.356  Who is the insured's legally adopted child?

    * * * We apply the adoption laws of the State or foreign country 
where the adoption took place, not the State inheritance laws described 
in Sec. 404.355, to determine whether you are the insured's legally 
adopted child.

[FR Doc. 97-2315 Filed 1-29-97; 8:45 am]
BILLING CODE 4190-29-P