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Will inheritance affect my Social Security Disability Insurance (SSDI) payments?

Continued eligibility for Social Security Disability Benefits is dependent on many different factors. These include your ability to work, your living situation, and any income and resources you have earned. However, the two disability benefit programs—SSI and SSDI—vary. What may disqualify an SSI recipient may not disqualify and SSDI recipient. Today we will be answering a question about the effect of inheritance on a person’s Social Security Disability Insurance benefits.

If you have a question that you’d like us to address in a future blog post, please leave it in the comment section below or contact us through Facebook, or Twitter. Today’s question is:

Will inheritance affect my SSDI benefits?

If you are a Social Security Disability Insurance (SSDI) recipient and receive an inheritance, it will not affect your benefits. SSDI is not a needs-based program and is not contingent upon your unearned income—including inheritance.

The only income that may potentially affect your SSDI benefits is any wages that you earn through employment. If you engage in Substantial Gainful Activity (SGA), your monthly payments could be lowered or eliminated as a result. In 2019, SGA is considered to be earning $1,220 or more in one month. If you begin working while receiving SSDI benefits, then it is necessary to report this income to the Social Security Administration (SSA).

However, if you are receiving Supplemental Security Income (SSI) benefits and have recently inherited funds, your benefits may potentially be affected. This is due to the fact that the SSI program is based on financial need. Any income, earned or unearned, can affect your benefits. Therefore it is imperative to inform the SSA of any changes to your income. You have up to ten days following the end of the month in which the change occurred to report the change.

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Comments

What happens when a person dies that's on retirement and has a son under18yrs old would that child still be eligible for any money and how much.

Hi Jose,

You can check your awards letter to see which one you have. If you do not have a copy available, you can log into your MySSA account or try calling the SSA at 1-800-772-1213 to find out!

Hi Tracy,
Because you are on SSDI benefits, you will not have any issue with inheritances.

Hi John,
SSDI does not have limits on unearned income, so you do not need to report it.

Hi Jane,
You're right! When you reach full retirement age, your benefits will convert to retirement benefits.

If I just got a slip and fall injury and since have settled , will I still be able to get my SSD payments along with my medicare ? I'm 58 years old now and it was a nasty fall injury which shattered my hip , and had to be completely replaced so which has left me not able to walk without a roller chair and or cane , doctor said NO to the working part of my life and and I am always in pain , so my question is what happens now. I should be able to still get my SSD and medicare , because they found the property to be neglagent. She isn't able to answer most of these questions due to kinda being a slow learner , putting it nicely , she is here for your records or whatever , now maybe I hope you understand my situation in helping her along thank you!

Hi Paul,

SSDI is based only on the work credits that you have earned while you were able to. Therefore any additional forms of income should not affect your payments or eligibility.

I was very worried I am currently on SSDI my mom passed away and left me a will of a little inheritance I was afraid to lose my SSDI because I need my medical and I need my SSDI because of my illness

Hi Skyla,

You don't have to worry because inheritance does not affect SSDI.

-Eric

What if you were on S.S.I. benefits. Will a lump sum of 25,000 dollars have to be reported. Can I just give it to someone else.

Hi Tracy,

I can't say for sure how it will affect your Medicaid, but that inheritance could affect your SSI benefits.

I am my sons payee he is on SSSI has been for a long time he has brain damage from a head I injury if I die and leave him money can he receive it without losing his check and medicare ins I have been told if I leave it to him if there is any left in his bank account it goes back to SSSI when he dies

Hi Patricia,

Unfortunately any unearned income, including inheritance may affect his SSI benefits.

Best Wishes,
Eric

I am on SSI,, my mother is 92 and if she dies and leaves me her house will I have to sell it and give the money to the SSI office???

Hi Jackie,

If you are on SSI, you should report any additional income (including property through inheritance) to the SSA.

Best
Eric

Hi Patricia,

They cannot do that, but they could decrease or cut off your benefits all together.

I would like to purchase a home and I was wondering if I would get penalized if I have y if I would I have a house and then if I pass on and pass it down to my daughter which is on SSD and if she would pass pass it down to her son which is on SSI would it affect either one of ours income or would we have to sell it and get money back to use

Hi Irene,

Since your daughter is on SSDI it will not affect her benefits, but since her son is on SSI, it could affect his.

HI Irene,
If someone is on SSI and receives a house, they may not be penalized if it is their primary residence or if they plan to use it as a primary residence.

I will be retiring soon at 62. Ive heard my company will be giving each person some money about $12,000 a person. I will be on my 7-8 month living on social security. will I be pentalized.

Are you working while receiving SSDI benefits? Either way, if you're on SSDI your retirement won't affect you so long as you're not retiring from a government position.

I receive disability Social Security payments less than $1,000 a month if I inherit $100,000 and sell my house and move into a bigger house will I have to pay property tax on the new house? I will not say whether I pay taxes on my home now or if it is in someone else's name but I have been told I don't have to pay property tax on a new house if I buy one.

Hi Manuel,
You may want to contact the SSA regarding this, as your eligibility may change due to the inheritance.

I get disability via social security, I’m 63 and married husband is 66 and recieves retirement social security. If I recieve life beneficiary of $100,000. How will it affect our benefits

Hi there,
It would only affect your benefits if you are reeceiving SSI benefits, which are income based.

John Doe has been receiving SSI benefits for 12 years. 6 years ago, John's father died, his house was sold, John received $100,000 cash inheritance which he put into the bank in an interest bearing account. John consulted a CPA at the time of the inheritance asking whether he should advise SSI of the inheritnce. The CPA said "no". John did not report the inheritance and continued to receive SSI benefits including Medicaid and food stamps. Since the inheritance occurred, John did report the interest income from the bank account to SSI, indicating John did not try to hide the inheritance. Now, 6 years later, SSI noticed the interest income from the bank account, questioned John (who told them the truth). SSI cut off all benefits and is saying John has to reimburse for all benefits received since the inheritance. Is this correct? What is the CPA's position in this? Comments and guidance will be appreciated.

Hi E.J.,
Yes, John has become ineligible for SSI benefits due to the interest. If he were on SSDI benefits, this would not be an issue. I do not think the SSA will say that he is excluded from disqualification due to the CPA's false advice. He can consider suing the accountant, but I have no idea if this is a valid option or if he could make a case. It's likely the CPA made a genuine mistake and did not understand SSI benefits.

Reading your reply, you seem to be saying John is ineligible for SSI benefits because he collected INTEREST on his inheritance he put into an interest bearing account. Wouldn't his receipt of the inheritance make him ineligible?

Thanks for your comment, Betty! Since John is on SSI, which is a need-based disability program meant for those who have little or no income or resources, the interest of his inheritance affected the "need-based" to qualify for SSI benefits. Hope this helps!

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