Resolving Inheritance Issues

Many individuals living with a disability or special needs receive assistance from government programs including Medicaid and Supplemental Security Income (SSI). When a beneficiary receives a large sum of money through an inheritance, however, their access to these government programs may be put in jeopardy.

Learn how to prevent and resolve such inheritance issues from occurring to ensure your relatives receive the financial security they need.

Receiving Government Benefits After an Inheritance

Receiving an inheritance from a relative can be an enormous gift, but it may impact how beneficiaries continue to receive assistance from needs-based government programs.

When a beneficiary receives an inheritance, the government views it as an additional source of income. Because SSI is based on financial need, a beneficiary’s access to SSI benefits may be jeopardized after receiving an inheritance. The same goes for Medicaid; because this program has strict income rules, anyone who receives an inheritance while on Medicaid could lose coverage.

One way around inheritance issues is to establish a pooled special needs trust (PSNT). A PSNT provides financial security for those living with a disability or special needs without sacrificing the beneficiary’s access to needs-based government programs. A first party special needs trust is the only type of trust that can be used to place funds received from an inheritance. The reason for this is that the inherited funds already belong to the disabled individual. A first party SNT is the only type of trust in which a disabled individual can put funds belonging to them.

If you need help resolving inheritance issues or you’d like to establish a PSNT for a loved one, our team at Legacy Enhancement Trust is here to help. We specialize in these areas of financial planning, and we provide personalized service and low fees to help you through the process as smoothly as possible.

Contact us today at (888) 988-5503 to learn how we may assist you!

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