Staff Reports
The Department of Health and Human Services’ Administration for Children and Families (ACF) has jolted state leaders with a simple message: stop taking Social Security survivor benefits that belong to foster kids. Assistant Secretary Alex J. Adams recently blasted governors — and singled out Minnesota — for letting agencies divert those earned dollars to pay for child-welfare costs. It’s federal pressure aimed squarely at a practice critics call the “orphan tax,” and it’s long overdue.
Federal crackdown on the “orphan tax”
ACF told 39 governors that their states allow some diversion of survivors’ Social Security benefits and urged immediate changes. Assistant Secretary Adams put it bluntly: “Every earned benefit dollar belongs to these foster youth, not the government agencies or bureaucrats.” Health and Human Services Secretary Robert F. Kennedy, Jr. backed the move, saying HHS wants every child to have a fair chance to thrive. The agency says only 11 states have policies to keep those benefits for the child, and ACF is offering technical help to fix the rest.
Minnesota in the crosshairs
Minnesota keeps coming up in the reporting. State and county records show Minnesota counties received about $2.79 million in federal benefits meant for foster youth in one recent year, and roughly 1,400 children in foster care may be eligible for survivor or disability payments. Lawmakers in Minnesota have held hearings where foster youth and advocates demanded the state stop seizing these checks. So when Adams called out governors, it was no mystery why Minnesota and Governor Tim Walz were highlighted — federal officials have already been pressing the state over child-care money and program mismanagement.
Why Social Security survivor benefits matter
These aren’t welfare windfalls. Social Security rules say a child can receive up to 75 percent of a deceased parent’s basic benefit. For a foster teen who ages out with little family support, that money can mean housing, school, or a chance to build a life. Letting state agencies use those funds to square their budgets turns earned benefits into an administrative piggy bank. It’s bad policy and worse optics: stealing from kids to fix short-term budget headaches.
What should happen next
Governors and state lawmakers need to act now: pass clear rules so earned survivor benefits are held for the child and reimburse counties for legitimate costs if necessary. Minnesota lawmakers can adopt the same fixes several states have quietly implemented after federal pressure. And credit where it’s due — ACF stepped into an ugly problem. If governors won’t protect these funds, federal oversight should keep up the heat until every child gets what’s rightfully theirs. Call it common decency, or call it accountability; either way, the orphan tax should be history.
