• Question
  • How will Inheritance effect Social Security income

    Asked on 12/23/2008

    I was layed off so I applyed for Social Security. I I'm 64.I had an uncle die this year an I was in is will and expect to receive about 25 to 30 thousand dollars(Estate will be settled Pending the sale of his Home).Will this wipe out my Social Security for the year I receive it? And is it possible to avoid it? Social Security only allows you to earn $13,000 till I turn 66.

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  • Categories: Social Security, Retirement Assets and Savings, Retirement Planning, Inheritance, Taxes, How Calculated?

Answers

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  • Inheritance is not earned income. It should have no effect on your social security. You will have to pay an inheritance tax on your inheritance. So
    before you get the inheritance, the government will have their hand out for
    money.

    Earned income is where you go out to get a job to make more money. Up to
    a certain age that will affect your social security. I retired at age 60.
    I could not even draw social security until I was age 62 and then I was not
    allowed to earn unlimited income until I was age 65 without it affecting my
    social security.

  • Login to rate this answer:   Answered on 8/16/2009
  • NewRetirement User

    65 year old from Rochester, NY

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  • It looks like it will impact your social security income for the year in which you get the inheritance if you are at or under your full retirement age.

    http://www.ssa.gov/retire2/whileworking.htm

    The good news is that once you reach your full retirement age the Social Security Administration should recalculate and increase your monthly benefit based on the reduced benefits due to your inheritance.

    http://www.ssa.gov/retire2/whileworking3.htm

    Essentially what is happening is that you are suspending your payments and paying back into the social security.

    Check out this article on the topic:
    http://community.newretirement.com/blogs/newretirement_news/archive/2008/08/28/10984.aspx

    You should call your Social Security office and ask them about this situation.

  • Login to rate this answer:   Answered on 12/24/2008
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  • my daughter is on her father social security disability she is 36. He died and he has a case for his cancer. she will given a inheritance from his estate. will she lose her social security benifit.

  • Login to rate this answer:   Answered on 10/19/2009
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  • what will happen when I get my inheritance

  • Login to rate this answer:   Answered on 10/19/2009
**All above answers are provided as general information only. No warranty is made regarding the fitness or accuracy of the information provided in this answer. You should seek advice from a licensed CPA, attorney or CERTIFIED FINANCIAL PLANNER™ as to your unique financial situation.