I have had a couple of clients recently ask about the possible effect of receiving inheritance money. In general, inheritance money will only have an effect if you receive Supplemental Security Income (SSI), but will not if you are receiving Disability Insurance Benefits (SSDI). If you receive Supplemental Security Income (SSI), then you likely will have your benefits cut or potentially eliminated. The receipt of any money will be counted as a resource affecting what you receive.
Ways to Protect Your Benefits
However, even with SSI, there are some wrinkles that may shelter your benefits upon receiving an inheritance.
The most common that I have seen in my practice occurs where an SSI recipient inherits a family home. As long as the SSI recipient lives in this home, then it can be exempted from consideration as a resource for SSI purposes.
For families that want to transfer a large inheritance to someone receiving SSI, there is another option. A valid special needs trust can allow for large amounts of money to be used for the care and benefit of trust beneficiary without being counted as a resource for SSI purposes.
Because Social Security is very strenuous in what trusts it will or will not recognize, any family considering establishment of a special needs trust should seek out an attorney with a lot of experience establishing such trusts.
For more information about resources, see our older post on SSI. For legal help concerning a social security disability-related issue, complete an online inquiry form or dial (901) 209-5500 to get in touch with our Memphis attorneys.
