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Inheritance and social security

Millersview, TX |

An aunt passed away recently and left all the nieces and nephews a $15,000.00 CD each. How is this reprted and does it affect Social Security benefits if you are drawing it and you are restricted on your yearly income?

Attorney Answers 3

Posted

Respectfully, I don't think either Mr. Pyke or Mr. McCormick understood your question. You want to know if a $15,000 inheritance counts as income while you are restricted. If you started receiving old-age benefits before your full retirement age, you agreed to a reduced monthly benefit amount with entitlement to be forfeited if you earned more than a defined amount in the year. An inheritance is not earned income; it is an asset. Because on Avvo we provide public information and not advice specific to a particular case, you may welcome the peace of mind that will come from confirmation that the general rule I have described applies in your case. You can do this be visiting your nearest Social Security office. You may need to wait in line, but the service representative at the window should be able to give the assurances you need.

Best wishes for a favorable outcome, and please remember to designate a best answer.

This answer is offered as a public service for general information only and may not be relied upon as legal advice.

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Posted

I'm going to leave the answer to the California attorneys, but the issues are:
1. I'm assuming MediCal is Medicaid and is means tested. If she takes the inheritance, it probably disqualifies her until she spends the money.
2. Social security is not means tested. Since the gift is not taxable income, there is no impact on receipt of SS or her income taxes.
3. Given the above, would it be better to "disclaim" the gift. It must be done according to state statute.

There is no legal relationship created or implied by the exchange of message on this website. All statements are not to be construed as legal advice but as general guidance. In all cases, an attorney should be retained to review the full circumstances and deliver advice consistent with the information learned.

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Posted

Inheriting money is not a taxable situation and it does not affect your social security, assuming you are on SSDI. However if you are receiving any SSI type benefits then this money will affect your benefits until you are below the threshold income limits.

Good luck.

DISCLAIMER: David J. McCormick is licensed to practice law in the State of Wisconsin and this answer is being provided for informational purposes only because the laws of your jurisdiction may differ. This answer based on general legal principles and is not intended for the purpose of providing specific legal advice or opinions. Under no circumstances does this answer constitute the establishment of an attorney-client relationship.

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