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Dwayne B.
Dwayne B., Attorney
Category: Legal
Satisfied Customers: 32325
Experience:  Began practicing law in 1992
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My x husband is on SSDI in Fl.( we need your help with Fl

Customer Question

Hello, My x husband is on SSDI in Fl.( we need your help with Fl Rules) His mother died (from upstate NY) and he is to receive 25,000 inheritance and possibly more after the mobile home is sold..Basically we are scared that he will lose EVERYTHING SSDI MONTHLY CHECK AND HEALTH INSURANCE. His brother n law is a lawyer in upstate New York and is severely concerned that he will lose his Medicare Part A and B, however we are afraid as stated he will lose everything. and also need to know if the inheritance has to be reported on his tax return? Can you help us with this please
Submitted: 9 months ago.
Category: Legal
Expert:  Dwayne B. replied 9 months ago.

Hello and thank you for contacting us. This is Dwayne B. and I’m an expert here and looking forward to assisting you today. If at any point any of my answers aren’t clear please don’t hesitate to ask for clarification. Also, I can only answer the questions you specifically ask and based on the facts that you give so please be sure that you ask the questions you want to ask and provide all necessary facts.

As a general rule, inheritance is not reported to the IRS. However, there are exceptions (many, many exceptions) and it depends on so many factors that the tax accountant would have to answer that.

If you are asking if it has to be reported on the IRS form because you want to know whether it will affect his government benefits, then that really is a separate issue because it can affect his government benefits whether it is reported on the tax return or not.

It is very likely that an income of $25k would prevent him from being able to draw SSDI, for a while at least, since that is a needs based program. Some government health care is needs based as well so the money could also prevent him from having that care.

There are ways to prevent this though. I'd suggest you talk to a local lawyer about drafting what is known as a Special Needs Trust (SNT). A SNT doesn't count as income or assets for purposes of government programs and the money can be spent on essential needs of your ex. There are some restrictions on what it can be used for but generally there is always a work around if something is needed.

The only real disadvantage to a Special Needs Trust is that when the beneficiary passes away then any of the funds which still remain go to the government and cannot be left to anyone else. However, usually there are very few funds remaining if the proceeds have been used correctly.

Please ask any follow up questions in this thread.

Customer: replied 9 months ago.
His take home SSDI pay is almost $1900 and his pension is $1100 that has about 3 to 4 years left. He also receives the medicare benefits part A and B
Customer: replied 9 months ago.
Would it be easier to call you to lead us in the right direction?
Expert:  Dwayne B. replied 9 months ago.

No, unfortunately I don't do telephone calls. The only thing that is an issue at all is whether the inheritance is taxable and I can't answer that without evaluating all of the estate matters as well as all of your ex's personal items which we can't do on here and, in addition, that calls for a formal legal opinion which we can't do either because we don't have an attorney client relationship.

Expert:  Dwayne B. replied 9 months ago.

The only way to know for certain whether the inheritance has to be listed is to go through all of the tax materials for him. The chances are high that it doesn't have to be mentioned on the taxes (90%+) but spotting the exceptions to the rules takes a lot of time and work, in person.

Customer: replied 9 months ago.
They said if we spend $52 we could call you? Is that the total bill. He has no assets. He lives in my house. If you think we just need a local lawyer, then will will have to do that.
Expert:  Dwayne B. replied 9 months ago.

I'm not sure what that is about. I have heard that the website automatically sends out emails offering phone calls. Some experts do those, I don't. I'm not sure how the payment works. I can contact the moderators and let them know you have a question about it if you would like for me to do so.

Expert:  Dwayne B. replied 9 months ago.

I can tell you that no one on here is going to tell you definitively whether or not you have to file this on your tax report because everyone will have the same issue, they have to do a complete evaluation of all of the documents to answer the question.

I can tell you that if he is paid $25k it is almost certainly going to mean he can't collect SSDI benefits any more. I can also tell you the Special Needs Trust will resolve all of the problems that he might have.

Customer: replied 9 months ago.
No that's ok for the phone call. We would like a copy of the transcript though to pass it on further as we figure this all out.
I do know he has no assets period and his truck is falling apart.
Thanks so much, Kelly Rutan
Expert:  Dwayne B. replied 9 months ago.

Once you issue your positive rating then it is my understanding the format changes into one that will allow you to print it using your browser's print function. If it doesn't then post again here and let me know and I will contact the moderators and ask them to get in touch with you about it. All of us experts are limited in what we can do with the actual website.

Also, once you issue your POsitive Rating the question locks open and you can come back to it anytime in the future that you want to do so.

The assets of a Special Needs Trust can be used to get new transportation for him or to repair the vehicle.

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