Dec42025
Estate Planning Q&A Series

How can my adult child on SNAP, Medicaid, and SSDI disclaim an inheritance without losing benefits? – North Carolina

Short Answer

In North Carolina, an adult child can generally disclaim (renounce) an inheritance under Chapter 31B of the General Statutes so that the law treats the child as though they died before the person leaving the inheritance, and the property passes to the next beneficiaries named in the will or under intestacy. A properly timed and drafted disclaimer means the child never legally owns the disclaimed assets, which helps avoid them being counted as the child’s resources for means-tested programs like SNAP and Medicaid. However, a disclaimer usually cannot direct assets back to the parents by design and may not be the best long-term planning tool compared with a well-drafted special needs trust. Because benefit rules and tax rules interact in complex ways, individualized advice from a North Carolina estate planning and benefits attorney is important before filing any disclaimer.

Understanding the Problem

The core question is whether, under North Carolina estate planning law, an adult child who receives SNAP, Medicaid, and SSDI can legally disclaim an inheritance so that the inheritance does not jeopardize those benefits. The concern is that receiving assets outright could push income or resources above program limits, especially for Medicaid and SNAP, and that a disclaimer might route the property to the parents instead. Families also want to know how a disclaimer compares to using a special needs trust under North Carolina law, and what timing and paperwork are involved.

Apply the Law

Under North Carolina law, a beneficiary can renounce (disclaim) an inheritance or other property interest by following the Renunciation of Property and Renunciation of Fiduciary Powers Act in Chapter 31B. When done within the statutory time frame, the law treats the beneficiary as if they predeceased the person who left the property, so the property passes to whoever would have taken in that situation. For needs-based benefits like Medicaid and SNAP, a properly structured disclaimer typically keeps the inheritance from becoming a countable resource because the beneficiary never accepts it. Separately, North Carolina’s pooled and special needs trust statutes in Chapter 36D allow certain trusts that do not count as assets for public benefits if they meet strict requirements.

Key Requirements

  • Valid written renunciation: The adult child must sign and acknowledge a written instrument that clearly identifies the transferor (the person who died), describes the interest being renounced, and states that the child is renouncing that interest, in whole or in part, as required by N.C. Gen. Stat. § 31B-1.
  • Proper filing and delivery: The renunciation must be filed with the clerk of superior court as an estate matter in the correct county and, if applicable, a copy delivered to the personal representative or trustee as outlined in § 31B-2 and § 31B-2.1.
  • Timing and effect on devolution: If the renunciation is filed within the federal “qualified disclaimer” period (generally within nine months of the transfer) the law treats the child as having predeceased the decedent, and the property passes to the next person or trust named, under § 31B-3. If filed later, the law still allows renunciation, but it may be treated as a transfer for tax and public benefits purposes.

What the Statutes Say

Analysis

Apply the Rule to the Facts: In the described situation, the adult child is on SNAP, Medicaid, and SSDI. SSDI is not means-tested, so a lump-sum inheritance would not by itself terminate SSDI, but it can affect Medicaid and SNAP, which are resource-sensitive. If the child signs and files a timely, properly drafted renunciation under Chapter 31B before receiving or controlling the assets, the inheritance can pass directly to whoever would take next under the will or intestacy, and the child never legally owns it. That generally avoids counting the inheritance as the child’s resource for Medicaid and SNAP. However, if the renunciation is late, or if the child has already accepted or used some of the inheritance, public benefit agencies may treat the act as a transfer for less than fair market value, risking a Medicaid penalty period. Separately, if the parent’s estate plan directs a share into a third-party special needs trust or a qualifying pooled trust rather than to the child outright, the trust can hold the funds for the child’s supplemental needs without being treated as a countable asset, which may be more protective and flexible than simply disclaiming and sending the money back up the family line.

Process & Timing

  1. Who files: The adult child (as beneficiary) signs the renunciation. Where: File the original with the Clerk of Superior Court, Estates Division, in a North Carolina county where the decedent’s estate is or could be administered, as an estate matter. What: A written “Renunciation” or “Disclaimer” that satisfies § 31B-1 (identifying the decedent, describing the interest, stating the extent of renunciation, and being signed and acknowledged). When: For a tax-qualified disclaimer, within the federal deadline (commonly nine months after the decedent’s date of death or other transfer date); later filings are still allowed under state law but have different tax and benefits implications.
  2. After filing, the personal representative or trustee reviews the renunciation and, under § 31B-3 and the will or trust terms, redirects the disclaimed share to the next taker (for example, siblings, contingent beneficiaries, or a pre-established special needs trust). The clerk’s processing time varies by county but is often measured in days to a few weeks.
  3. For families choosing a special needs trust route, the planning step usually occurs before the parent’s death: updating the will or revocable trust to send the child’s share directly into a compliant third-party special needs trust or a qualifying pooled trust under Chapter 36D. At death, the personal representative funds that trust, and the trustee then administers it for the child’s supplemental needs while coordinating with Medicaid and SNAP rules.

Exceptions & Pitfalls

  • Disclaimers generally cannot be used to steer property to a chosen recipient; the property must pass as the will, trust, or intestacy statute already provides for someone who is treated as having died first. If the default next taker is not the parents, a disclaimer will not redirect the inheritance back to them without prior planning.
  • If the child has already accepted any benefit from the inheritance (such as spending funds or directing investments), the right to renounce may be barred or, at minimum, the disclaimer may not be respected for federal tax or Medicaid transfer-of-assets purposes, risking a period of ineligibility.
  • Medicaid transfer-of-asset rules can penalize gifts or transfers for less than fair market value made within a look-back period. While a timely qualified disclaimer generally is not treated as a transfer, a late or improperly structured renunciation may be. Coordinating with current Medicaid policy is critical because procedures evolve.
  • SNAP eligibility focuses on both income and countable resources. If the inheritance is received and then given away, it may count as a disqualifying transfer; that is very different from never receiving it at all through a proper disclaimer.
  • With special needs and pooled trusts under Chapter 36D, the trust document must follow state and federal rules closely. If the trust is drafted or administered incorrectly (for example, allowing funds for non-benefit purposes or violating the “sole benefit” standard), agencies may treat the trust assets as available resources and terminate benefits.

Conclusion

Under North Carolina law, an adult child on SNAP, Medicaid, and SSDI can generally disclaim an inheritance by signing and filing a proper written renunciation under Chapter 31B before accepting the property, so the law treats the child as having predeceased the decedent and the inheritance passes to the next designated beneficiary rather than becoming the child’s asset. This approach can protect means-tested benefits but cannot be used to custom-redirect property and may be less protective than leaving the share directly to a compliant special needs trust. A sensible next step is to have a North Carolina estate planning and public benefits attorney review the will or trust and, before any funds are received, advise whether a disclaimer, a special needs trust, or both is the safer path.

Talk to a Estate Planning Attorney

If a family member receives SNAP, Medicaid, and SSDI and may inherit assets, careful planning is needed to avoid disrupting those benefits while still providing long-term support. If you’re dealing with questions about disclaimers, special needs trusts, or how an inheritance will affect public benefits in North Carolina, our firm has experienced attorneys who can help explain the options and timelines. Call us today at 919-341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Estate Planning Q&A Series

Author: jpierce

Attorney Jared Pierce is the founder of Pierce Law Group in Raleigh, North Carolina, a firm he established with a dedicated focus on probate administration and estate planning across North Carolina. Born and raised in the Republic of South Africa, Jared moved to Durham with his family in 2001, bringing with him a rich cultural background and a distinctive accent that often serves as a conversation starter.