Dependent parents survivor benefit

I would verify with the SSA for your particular case. The issue of family maximum can be a bit complex. Also, benefits for dependent parents is relatively rare, and I couldn't find much information on it.

Dependent parents can receive survivor benefits if they are age 62 or older. For parents to qualify as dependents, you would have had to ­provide at least one-half of their support. I assume support can be demonstrated if you claimed the parents as dependents on your tax returns.

http://www.ssa.gov/pubs/10084.html#2

As far as the family maximum and what you might expect to receive, I pulled up the following typical case from the SSA's quick calculator :

http://www.ssa.gov/OACT/quickcalc/index.html

Survivors                              Monthly benefit amount
---------                              ----------------------
Your child                             $856.00
Your spouse caring for your child      $856.00
Your spouse at normal retirement age   $1,141.00
Family maximum 	                       $1,938.40

Based on this I could see your two children getting a combined benefit of around $1,500 monthly ($750 each), leaving about $400 under the family maximum.

So if the parents received survivor benefits, I could see each child getting $650 and the parents $650 for a total monthly benefit of $1,950 (family maximum).

So the benefit for your children would fall, but benefits for the entire family would increase by $450 (up from $1,500).

I did not see a "time limit" for parental benefits. This is unlike the children which have a limit of age 19 / high school graduation unless disabled.

However, for the parents, the calculus may change if they do or will receive Social Security benefits based on their own work record. I couldn't find specifics on this for dependent parent benefits, but in general Social Security only pays the highest single benefit - not a sum of several benefits. So if, for example, the parents could qualify for $1,000 in retirement benefits based on their work record, it may not be worthwhile applying for survivor benefits as a dependent parent.

Again, check with Social Security for your case.