Will inheriting money affect my Social Security benefits?

Social Security and SSDI are contribution-based programs. However, receiving an inheritance won’t affect Social Security and SSDI benefits. SSI is a federal program that pays benefits to adults over age 65 and children who have limited income and resources and are blind or disabled.

Do I have to report inheritance as income?

Inheritances are not considered income for federal tax purposes, whether you inherit cash, investments or property. However, any subsequent earnings on the inherited assets are taxable, unless it comes from a tax-free source.

How does an inheritance affect your disability benefits?

If you are concerned about how your inheritance and income will affect your eligibility for disability benefits, it is important to note that the SSA does not count all income towards the SSI limit. The SSA will count your inheritance towards the limit unless it is protected under one of the special types of accounts we discuss in the next section.

Can a disabled person inherit money from a trust?

Someone can give you money into a trust, or you can inherit money this way, and it will not affect SSI if the trust is properly written. ABLE Accounts – ABLE accounts can be opened by anyone who first became disabled before age 26.

Do you still get SSDI if you get inheritance?

So, if you receive an inheritance and are currently receiving SSDI, then you are okay and will continue to receive your SSDI benefits as you normally would.

Do you have to report an inheritance to Social Security?

However, if you received an inheritance and are currently receiving SSI benefits, then you will need to report that money to the Social Security Administration, and you will not receive SSI benefits while your assets remain over the allowable amount (in 2011 that amount is $2000 for individuals and $3000 for a married couple)