Detailed Answer

Supplemental Security Income (SSI) and North Carolina Medicaid both use strict asset and income tests. An inheritance generally counts as a resource or as unearned income. If you receive a lump‐sum inheritance, federal SSI rules treat it as unearned income in the month you receive it. It can reduce or suspend your SSI for that month. Beginning the following month, the leftover funds count as a resource.

Federal SSI imposes a $2,000 resource limit for an individual and $3,000 for a couple. If the inheritance pushes your resources above that limit, the Social Security Administration will suspend your SSI payments until you bring your countable assets back below the limit.

North Carolina Medicaid for aged, blind, and disabled recipients applies the same $2,000 individual resource standard. See N.C.G.S. § 108A-54. When your resources exceed that limit, the Division of Health Benefits will close your Medicaid case until you meet the asset requirement again.

Because both programs share similar thresholds, a single inheritance can jeopardize both SSI and Medicaid. The key is to act promptly:

• Plan how you hold or use the inheritance.
• Convert countable assets into exempt assets when appropriate.
• Consider specialized trusts under federal rules to protect eligibility.

Failing to address a resource overage can leave you without benefits for months. It also may trigger a Medicaid penalty period if you transfer assets without fair compensation. To avoid unintended disqualification, you should review options before you receive or spend the inheritance.

Key Points to Consider

• SSI Resource Limit: $2,000 for an individual (42 C.F.R. § 416.1205).
• Medicaid Resource Standard: $2,000 for an individual in the aged, blind, and disabled program (N.C.G.S. § 108A-54).
• Month of Receipt: Inheritance is unearned income for SSI and may reduce benefits that month.
• Countable Resources: Cash, bank accounts, investments.
• Exempt Assets: Primary home equity, one vehicle, personal effects, burial plots.
• Spend-Down Options: Purchase exempt items or pay medical expenses to reduce countable resources.
• Trust Strategies: First-party disability trusts or pooled trusts can shelter assets if established under federal guidelines.

Next Steps

If you expect an inheritance or have already received one, take prompt action. Our attorneys at Pierce Law Group will help you evaluate your options and preserve your SSI and Medicaid benefits. Contact us today by emailing intake@piercelaw.com or calling (919) 341-7055.