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

Submitted by Daniel on Fri, 12/20/2013 - 12:52

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 2023, SGA is considered to be earning $1,470 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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Blog comments

John (not verified)

Hi, I had a severe brain hemorrhage, caused by an AVM, in 1997. I had 1 brain surgery the day it happened and a second surgery the next day to remove more blood clots and more damaged brain tissue. My girlfriend was the one who realized I was even having a life threatening problem happen. I just thought I was having a really bad headache. My girlfriend called 911 and got me to the hospital in time for the surgeon on call to do anything. My girlfriend did not have any legal power to make decisions for me so she called my Dad and brothers to inform them that there had been an emergency and that I was in surgery. My oldest brother immediately out a "no code blue" on me and got mad at my GF for allowing surgeries to take place without his consent. 5 days later my family managed to have me removed off all life support because they claimed they could not deal with the situation. Meanwhile, the took all my valuables out of my home and completely drained my bank accounts. Obviously, I did not die. My family walked away but my GF stood by me and helped me go through absolute hell to even get to the point that I am now. After my brother realized I was not going to die right away, he somehow got me a small amount of money coming in each month from SSA. My question is; how can I find out if I am on SSI or SSDI? I get a direct deposit of about $700 each month and I get a Form SSA-1099 Social Security Benefit Statement. It does not say on it waht kind of benefits i am actually recieving. My GF has been taking cnr of me for the last 19 years. but she has never been able to find out anything for me either as it seems my oldest brother, who I have not even seen in the past 15 years, has all the info about me. What can I do, or my GF do, to find out if I am getting SSI or SSDI? (GF has helped me type this, but words and Q's are mine)
thank you!

Tue, 02/23/2016 - 15:46 Permalink

In reply to by John (not verified)

Hi John,
I am sorry to hear that! I am actually not sure how to find this out because the benefits you're earning are low enough to either be SSDI or SSI. Have you worked before? What you could do is log into your My SSA account on www.ssa.gov to see your benefits. If you don't have an account yet, you can just make one so long as you know your Social Security number.

Thu, 03/24/2016 - 13:14 Permalink
Kelly goodman (not verified)

In reply to by Deanna

Hi there so sorry to hear about this , family is something else ! I'm thinking your on ssi , 700 or so is usually ssi ,,, on the other hand I have been on Ssdi for well since 95 ,,,, si I've worked off and on, and was basically on my fathers payroll for insurance when I was younger . At the time I couldn't keep it together crying , hyper , medications side effects etc so my doctor put me on SSDI it's much higher amount and after 2 yrs receive medical which who would have been able to afford to keep me alive ? But my family and my dad would make comments and hurt me , if you paid into the system thru employment and need the medical and hospitalization this is what u needed ,,, my dad passed in August and I'm receiving the same as my siblings except I'm getting avtrust set up to give me the same amount each month , then in 2 yrs the woman who he married and she was basically waiting she is ri live there for 2 yrs and the trust pays for everything then we get the house and. Sell enormous money although I'm having to trust my brother gives me my share since my dad purposely immitted me from the trust ( I'm an addict I have hiv for 31 yrs and he wanted to make sure I still will get my benifits and reading all these story's looks like he didn't have to give it all to my brother inheritence will not affect my trust but as they get a huge amount of I'm gonna be afraid of this since we are all 50 plus and well here's my question is this do I stay nervous for 2 yrs wondering if I am going to be able to invest like a condo whatever,? Should I get a note or just trust that we will sell thehoug

Wed, 01/04/2017 - 09:30 Permalink
Fran (not verified)

In reply to by John (not verified)

If I sue a Dr. for injuries caused by malpractice will I lose my SSDI? Went in for bronchoscopy for pneumonia...came out with renal failure. As of this time no decision has been made.

Thank you for any advise you an give me.

Tue, 05/02/2017 - 16:42 Permalink

In reply to by Fran (not verified)

Hi Fran,
You would not lose your SSDI due to any settlement you may make as SSDI benefits are based on work record rather than income and resources.

Wed, 05/03/2017 - 09:54 Permalink
Beck (not verified)

I have a durable power of attorney for my mother. She wants to gift the maximum amount of money this year--$14,000-- to each of her children, one of whom receives SSI. How much money may that adult child be gifted, if any, without posing a risk to his benefits? Eventually, each of us may inherit a large sum. Should we consider contacting an attorney to establish a Special Needs Trust?

Thu, 02/25/2016 - 00:10 Permalink

In reply to by Beck (not verified)

Hi Beck,
The maximum resource limit for SSI benefits is $2000 for individuals and $3000 for families. If they have more than that in savings, your sibling would become ineligible for benefits. Because this is the case, a Special Needs Trust may be a good option to ensure that your sibling is gifted that money without a change in his or her benefits.

Mon, 03/21/2016 - 10:31 Permalink
bob (not verified)

My friend is on ssi and his mother was the executor of his account on his behalf. She had just passed and his family will be selling their house and spending the money. If he gets a $15,000 what should he do with the money and should he reported to SSI? He is 60 years old, because of his mental state and his mother's death what will happen if his SSI?

Mon, 02/29/2016 - 09:01 Permalink

In reply to by bob (not verified)

Hi Bob,
Yes, your friend should report the income to the SSA. I could not tell you what he should do with the money, but there are income limits for SSI benefits, ( $2,000 for Individuals and $3,000 for families), and if your friend goes over that limit he may become ineligible for benefits.

Mon, 03/21/2016 - 10:26 Permalink
Cat (not verified)

In reply to by Bryan

If he is receiving benefits for mental health and is only 60 yrs. old, I'm pretty sure that he would be receiving SSD and not SSI. And in that case it changes things to his advantage. I think the law is different for SSI than SSD.

Sun, 04/16/2017 - 17:22 Permalink

In reply to by Cat (not verified)

Hi Cat,
It's true that SSI and SSDI have different rules, however anyone of any age can receive SSI benefits as they are based on income and resources rather than work record.

Mon, 04/17/2017 - 13:58 Permalink
Nee Pham (not verified)

My father in law involved in car accident. He may receive a lump sum (over 2000.00) from Insurance. If he receives this fund, will he be disqualified for SSI benefit.

Thu, 03/03/2016 - 00:38 Permalink

In reply to by Nee Pham (not verified)

Hi Nee,
I'm sorry to say that if this lump sum puts him over the resource limits ($2,000 for individuals and 3,000 for families) then yes, that lump sum may make him ineligible for SSI benefits.

Mon, 03/21/2016 - 10:22 Permalink
Vanessa (not verified)

HI I am on ssdi and my father died in October last year. He left my brother and I a retirement IRA. Will they take my disability payment away because of this inheritance.

Thu, 03/03/2016 - 16:15 Permalink

In reply to by Vanessa (not verified)

Hi Vanessa,
I'm very sorry for your loss. Inheritance is not considered earned income, and does not count against your income limits for SSDI, so you should not lose benefits by receiving the inheritance.

Mon, 03/21/2016 - 10:16 Permalink
Lili W. (not verified)

I'm collecting SSI and my mother just died. I think I may receive an inheritance of some sort but want keep my benefits. Do I have to take the inheritance?

Thu, 03/10/2016 - 04:42 Permalink

In reply to by Lili W. (not verified)

Hi Lili,
If you do take it and it does not put you over the asset limits for SSI, you would only lose benefits for the month that you received the inheritance, as it is counted as income when you report it to the SSA.

Mon, 03/21/2016 - 10:07 Permalink
shannon (not verified)

so, again, my neighbor inherited hundred of thousands of dollars. she collects ssi disability. she had her daughter keep it in her bank account to "hide" it so she will still recieve a check. the inheritencce her son got, also has his sister hold it in her account, to keep from paying child support. my questin is: ARE THESE FRAUDULENT? when you hide what you've inherited, so you cvan keep the checks coming?

Mon, 03/21/2016 - 09:38 Permalink

In reply to by shannon (not verified)

Hi Shannon,
I would not be able to say because I'm not aware of the exact circumstances, but not disclosing income to the SSA with the intent of keeping benefits may be a crime. I would contact the SSA at the toll-free Social Security Administration Fraud Hotline at (800) 269-0271 if you feel they are defrauding the SSA.

Mon, 03/21/2016 - 10:12 Permalink
shannon (not verified)

is it fraud when the inheritence isn't reported, and the person hides the inheritence in their daughters bank account? hiding the funds, and not reporting it seems fraudulent to me since its being hiden, covered up , and not reported. so is it?

Mon, 03/21/2016 - 09:47 Permalink
judy k (not verified)

I receive ssdi -- medicare and medicare. My mom passed away leaving me about $3,300 in a trusts she made out. Do i have to report this to social security? Will this affect my benefits? Or can I have the trustee paid for things I need instead of giving me the cash?

Tue, 03/22/2016 - 00:46 Permalink
Curious (not verified)

If someone is receiving SSI and Medicaid only do they have to report a personal injury settlement. What is the procedure for such a case?

Thu, 03/24/2016 - 16:34 Permalink

In reply to by Curious (not verified)

Hi Curious,
If someone gets SSI and then gets a settlement, then yes, they must report the money to the SSA. The money is counted as income for the month that they receive it, and after that month it gets counted as a resource. Depending on the amount of the settlement, it may affect their benefits for the month they receive it and the following months if it is over the $2000 resource limit for SSI receipients.

Tue, 03/29/2016 - 15:40 Permalink
Justin (not verified)

I get social security disability benefits as a disabled adult child under my retired dads working record. As I understand it's just like I get ssdi and do not have any resource limit. With that said.. sadly my aunt died 3 days ago and has left me her several thousand $ life insurance policy. So my question is do I have to report that I'm getting the money to social security? Seeing it isn't income that I've gotten from work. Or do I have to report it.. I need to know whether I have to report it to them or not cause I don't want to lose my monthly benefits.. the life insurance isn't gonna last forever. So anyways.

Fri, 03/25/2016 - 03:45 Permalink

In reply to by Justin (not verified)

Hi Justin,
There is no limit for unearned income for SSDI benefits, so you may not have to report that money to the SSA.

Fri, 03/25/2016 - 09:43 Permalink
Justin (not verified)

In reply to by Bryan

May not have to or I don't have to? Im sorry.. I'm confused.. May not means I might not have to. But that I also might have to.. it can mean either or. and I think this might get posted twice.. not sure if it went through the first time.

Fri, 03/25/2016 - 11:21 Permalink

In reply to by Justin (not verified)

Hi Justin,
Since we're not affiliated with the SSA, we can't say for certain if they would need you to report the money. I would contact the SSA for more specific information about this.

Fri, 03/25/2016 - 14:49 Permalink
May (not verified)

I have a relative that receives only $650 p/mo month in ssi but expecting an inheritance. The person legitimately owes more than the anticipated inheritance in debt to another relative who has consistently paid the person's monthly apt. rent and storage rental unit fees over the past decade. Can the inheritance check be signed over to that person as repayment for the debt without negatively affecting their ssi?

Sat, 03/26/2016 - 08:31 Permalink

In reply to by May (not verified)

Hi May,
If your relative receives the inheritance and signs it over to the other relative, your relative getting SSI would only lose benefits for that month, as it would be counted as income. If they kept the inheritance beyond that month, then it would be counted as a resource and therefore may make them ineligible for SSI.

Tue, 03/29/2016 - 15:26 Permalink
Rosi (not verified)

My friends mother is on SSA and her mother passed recently and put her part of the inheritance in a Trust that she cannot touch unless something happens and she is not eligible for SS. Her sister is the executive, however has never showed her an accounting of her trust, it has been 6 years now. (They obviously don't get along) will she lose her benefits of its in a trust that she cannot use/touch? Also, she is a senior citizen and I feel like her sister is taking advantage of her and possibly spending the trust money, she is scared to hire an attorney because her sister could use the money in the trust and because she doesn't know how much is there she is scared. She wants to make sure the trust goes to her daughters when she passes.

Sun, 03/27/2016 - 22:31 Permalink

In reply to by Rosi (not verified)

Hi Rosi,
That sounds like quite a situation to be in! I'm sorry for your friend's troubles.
If your friend is receving SSDI, the trust should be fine as SSDI is based off of her work record and it doesn't have limits for resources or unearned income.

If your friend is on SSI, there are some types of trust that are exempt from SSI's income and resource limits. These include "special needs trusts" and "pooled trusts". if your friend's trust is either of these kinds, the trust might be exempt from SSI resource limits.

Tue, 03/29/2016 - 15:35 Permalink
Brian (not verified)

Our father passed recently; my sister is receiving SSI, can I set up an annuity for her since my father did not fund any assets to the special needs trust for her future? Thank you for your assistance.

Wed, 03/30/2016 - 13:57 Permalink

In reply to by Brian (not verified)

Hi Brian,
I am sorry to hear that. You can set up an ABLE account for her depending on which state you live in. You will need to call the SSA at 1-800-772-1213 to see if your state allows ABLE accounts yet. They're savings accounts for people on SSI benefits.

Thu, 03/31/2016 - 13:29 Permalink
Deb (not verified)

My mother got SSI until she inherited property from her mother's death. She is no longer getting benefits because if this. My question is can she sign her part of the inheritance over to one of her siblings and would she start receiving her benefits again as she would no longer own any property? The property is tied up in court between her family because some want it sold and others don't. So this fight may continue for years and in that time she has zero benefits. If signing over her part to someone else isn't an option, what other options does she have to get her benefits back?

Wed, 03/30/2016 - 17:48 Permalink

In reply to by Deb (not verified)

Hi Brian,
She can sign over the inheritance. I believe that the application process is pretty simple if she was recently kicked off SSI benefits due to an income limitation.

Thu, 03/31/2016 - 13:28 Permalink
Robby (not verified)

I'm on ssi and rent a single family house...My landlordwantstoput my name on the deed and leave me the house...If I end up with the house someday, will I lose my ssi???? I was told if I sell it I would lose my ssi but not if I continue tolive in it...This is in R.I

Fri, 04/01/2016 - 09:08 Permalink

In reply to by Robby (not verified)

Hi Robby,
If you do inherit the house and stay in it, your benefits would not change as the SSA does not count your house as a resource if it is your primary resource. If you did sell it, that money would be counted as income and may make you ineligible for benefits.

Fri, 04/01/2016 - 09:33 Permalink
Debra (not verified)

My husband is on SSDI & I get a small check off his benefits when I turned 62. My mom passed & I'm going to get an inheritance off her estate. Won't be very much $5000 -$8000 maybe. Would this affect our Social security checks? My handicap son is 41years old & lives with us & he gets SSI & SS off his father. They sit it up when my husband got disabled. Will my inheritance affect our checks. I only get $215 a month.

Sat, 04/02/2016 - 13:15 Permalink

In reply to by Debra (not verified)

Hi Debra,
The inheritance will not affect your or your husband's payments or your son's SSDI benefits, however it may affect your son's SSI payments if those payments are based off of you and your husbands income and resources.

Mon, 04/04/2016 - 13:10 Permalink

In reply to by laura (not verified)

Hi Laura,
Your Survivor's benefits will not be affected by inheritance as those benefits are based off the work history of the person whom you're getting survivor's benefits for.

Mon, 04/04/2016 - 13:12 Permalink
Debbie (not verified)

I was accepted on SS Disability in 2011 and since then, my CPA told me I no longer had to file taxes each year due to my income being below poverty level and I qualify for the Extra Help program here in FL. For the last 7 years, I have been power of attorney and caregiver for my godmother who lived with me. Since I am disabled, she paid to have home health aides come in each day to help her with her ADL's that I could not do for her. At the end, we had 3 aides so someone was always here 24/7, along with Hospice to help me. My godmother passed away 2 months ago, and since then I have found out that in her will, she left me approximately $50,000. Is this considered an inheritance, and if so will it affect my SS Disability Income checks each month? I received papers from the Insurance Co to fill out, and I checked the box that stated I want them to take all taxes out before they send me a check. Will I now need to file taxes again on this money? Thank you for any information you can give me.

Tue, 04/12/2016 - 01:07 Permalink

In reply to by Debbie (not verified)

Hi Debbie,
I'm sorry to hear about your loss!
I would talk to your CPA about how this changes your tax filing. The money that your godmother left you would only affect your disability payments if you are getting SSI benefits which are based off of income rather than work record. If you are on SSDI benefits, then there would be no change to your benefits.

Tue, 04/12/2016 - 10:26 Permalink
nancy (not verified)

i am currently recieving social security disability ,i have a check from my brother who is overseas ,he sent the check in my name to deposit it in my checking account ,then send it to him since there are so many scams overseas, if i deposit in my checking account then send it to him will it affect my social security benifits,its not my money but its for $350,000.00

Thu, 04/14/2016 - 15:59 Permalink

In reply to by nancy (not verified)

Hi Nancy,
I don't know the whole story, but that sounds like someone has stolen your brother's identity and is attempting to commit wire fraud. I would not deposit that check before verifying with your brother ( over the phone, over skype, ect) that he himself sent that check. Also, you would most likely lose your benefits if you deposit that check in your account.

Fri, 04/15/2016 - 10:24 Permalink
Diana (not verified)

My husband receives SSI benefits. If I receive an inheritance of over $3,000 I know he will lose his benefits for the month the inheritance is received. However, if we use that inheritance within the month on much needed home repairs will he be able to get his SSI benefits the next month?

Thu, 04/14/2016 - 21:58 Permalink

In reply to by Diana (not verified)

Hi Diana,
Your husband should be able to continue getting benefits if you used that inheritance for home repair before the month is over.

Fri, 04/15/2016 - 10:27 Permalink
Cherie Murray (not verified)

I don't know if I'm receiving SSDI or SSI. I started out on disability but then I turned 62 un March. Did that change me from disability to SSI?

Fri, 04/15/2016 - 22:00 Permalink

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