Do You Need to Report Inheritance to the SSA?

Receiving an inheritance can be both a blessing and a source of confusion, especially if you’re currently receiving Social Security benefits. Understanding your reporting obligations to the Social Security Administration (SSA) is crucial to maintain your benefits and avoid potential complications.

The Short Answer

Whether you need to report an inheritance to the SSA depends primarily on the type of Social Security benefits you receive:

• Social Security Retirement Benefits: No reporting required
• Social Security Disability Insurance (SSDI): No reporting required
• Supplemental Security Income (SSI): Yes, must report within 10 days

How Inheritance Affects Different Social Security Benefits

Social Security Retirement and SSDI

If you receive Social Security retirement benefits or SSDI, inheritance money generally won’t affect your benefits. These programs are based on your work history and prior contributions to the Social Security system, not your current income or resources. You can receive an inheritance of any amount without impacting these benefits.

Supplemental Security Income (SSI)

SSI is different because it’s a needs-based program for people with limited income and resources. An inheritance can affect your SSI benefits in several ways:

• The inheritance counts as a resource starting the month after you receive it
• SSI has a resource limit of $2,000 for individuals and $3,000 for couples
• Exceeding these limits can make you ineligible for SSI benefits

What Counts as Inheritance?

The SSA considers various forms of inheritance, including:

• Cash
• Real estate
• Stocks and bonds
• Life insurance payouts
• Personal property
• Trust distributions

Reporting Requirements for SSI Recipients

If you receive SSI, you must:

• Report the inheritance within 10 days of the month following receipt
• Provide documentation of the inheritance amount and type
• Update your resource declaration to the SSA

How to Report

1. Contact your local Social Security office
2. Call the SSA at 1-800-772-1213
3. Submit documentation online through your my Social Security account

Strategies for SSI Recipients Receiving an Inheritance

To maintain SSI eligibility after receiving an inheritance, consider:

1. Special Needs Trust: Transfer the inheritance to a properly structured special needs trust
2. ABLE Account: If eligible, deposit funds into an ABLE account
3. Spend-Down: Utilize the inheritance for approved expenses before the end of the grace period

Legal Consequences of Not Reporting

Failing to report an inheritance to SSA when required can result in:

• Benefit overpayments
• Requirement to repay benefits
• Potential penalties
• Possible criminal charges in cases of intentional fraud

When to Seek Legal Help

Consider consulting with an attorney if:

• You’re unsure about reporting requirements
• You need help structuring an inheritance to maintain benefits
• You’ve received a large inheritance and want to protect your benefits
• You’ve failed to report an inheritance and need assistance resolving the situation

Conclusion

Understanding your reporting obligations to the SSA regarding inheritance is essential for maintaining your benefits and avoiding complications. While retirement and SSDI beneficiaries generally don’t need to report inheritance, SSI recipients must be vigilant about reporting and managing inherited resources to maintain their eligibility.

For specific guidance about your situation, contact Lemoine Law Firm. Our experienced attorneys can help you navigate the complexities of Social Security benefits and inheritance reporting requirements to protect your interests and ensure compliance with all applicable regulations.