You asked when Gail J~'s interest in an inheritance in an estate should be treated
as a resource or income for the purpose of determining SSI eligibility for her son,
Jacque G. J~. We have reviewed the account documents and, for the following reasons,
we conclude that Ms. J~'s inheritance interest should be treated as income on the
date of Shirley W~' death and a resource beginning the following month.
Gail J~ became one of four heirs to the estate of Shirley W~ ("Decedent") after her
death, on August 31, 2006. On September 14, 2006, the Decedent's Last Will and Testament
was probated and an estate was established. On that same date, Ms. J~, along with
the three other heirs, created a "Family Settlement Agreement" ("Agreement"). Ms.
J~ was appointed as a co-executor of the estate. The Agreement set forth terms on
the distribution of some of the estate assets. The relevant terms of the Agreement
stated that the following assets would be contributed to the proceeds of the Decedent's
estate: a Certificate of Deposit in the amount of $35,480.62, minus $16,500.00, and
a checking account in the amount of $35,877.68. Other assets in the Decedent's estate
are a condominium; two transfers from checking accounts in the amount of $413.00 and
$554.42; a life insurance policy in the amount of $4,000; an automobile; and furniture.
Prior to the Decedent's death, Ms. J~ and Jacque moved into the condominium, and it
is currently being used as their principal residence. The estate is currently in probate
and has not yet been settled or closed.
Under SSA's Program Operations Manual System (POMS), inheritance is an interest in
a decedent's estate either under a will or under the laws of intestacy. POMS SI CHI
00830.550. In all states in Region V, an inheritance constitutes income as of the
date of death, and a resource in subsequent months. See POMS SI CHI 00830.550(F); Memorandum from Reg'l Chief Counsel, Chicago, to Assistant
Reg'l Comm'r-MOS, Chicago, Regional Supplement
on When Inheritance Property Becomes Income (Mar. 4, 2003, Update Mar. 13, 2007).
Under Indiana law, title to the real and personal property vests immediately with
the heirs, but is subject to possession of the personal representative, who is responsible
for paying expenses and administering the estate. See Ind. Code Ann. § 29-1-7-23 ("[w]hen a person dies, his real and personal property,
passes to persons to whom it is devised by his last will, or, in the absence of such
disposition, to the persons who succeeded to his estate as his heirs; but it shall
be subject to the possession of the personal representative and to the election of
the surviving spouse and shall be chargeable with the expenses of administrating the
estate, the payment of other claims . . .").
In Indiana, as an heir, Ms. J~'s interest is transferable prior to final settlement
of the estate, since the law provides that, although the final decree in probate is
the final adjudication of the transfer of the property to distributees, "no transfer
before or after the decedent's death by an heir or devisee shall affect the decree,
nor shall the decree affect any rights so acquired by grantees from the heirs or devisees."
Ind. Code Ann. § 29-1-17-2(d); see
also Helvey v. O'Neill, 288 N.E.2d 553, 557 (Ind. Ct. App. 1972) (sale of real property by heir prior to
final settlement of estate passed title and right of possession to purchaser); Boice
v. Mallers, 96 N.E.2d 342, 345 (Ind. Ct. App. 1950) (trustee effectively passed title to stock
by transferring it prior to settlement of the estate).
As such, on August 31, 2006, when Ms. J~ became one of four heirs to the Decedent's
estate, she had an interest in the property of the estate and title in Decedent's
property vested immediately in Ms. J~. The amount of income would be determined by
the market value of her right to inherit as of the date of Decedent's death. See POMS SI CHI 00830.550(F). Although Ms. J~ had an inheritance interest in the condominium,
it is being used as the principal residence for Ms. J~ and Jacque. Therefore, her
share of the interest in the condominium constitutes income up to the presumed maximum
value rule in the month of Decedent's death. POMS SI 00830.550 (A)(4). However, in the following months it would be excluded as a resource. See 20 C.F.R. § 416.1212.
In sum, we conclude that Ms. J~'s inheritance was income as of the date of Decedent's
death and a resource beginning the following month.