Understanding Inheritance Theft Laws

Receiving an inheritance could provide an unexpected (or anticipated) financial windfall. Unfortunately, there is one thing you may have to contend with alongside it: people attempting to steal what you’ve inherited. Inheritance theft can be a very real problem for people who inherit money, property or other assets. If you’re set to receive an inheritance or have received one that was stolen from you, it’s important to understand what legal rights you may have for getting those assets back.

A financial advisor can help with estate planning to minimize potential conflicts after your death.

What Is Considered Inheritance Theft?

Inheritance theft can take different forms, with some being more obvious and others more subtle. Some common examples of inheritance theft, or inheritance hijacking, include:

An executor of a will who steals or attempts to hide assets from the estate inventory
A trustee who diverts assets from a trust for their use or benefit
Executors or trustees who charge excessive fees for their services
Abuse of power of attorney status
Use of coercion or undue influence to force a will-maker or trust grantor to change the terms of their will or trust
Fraud or forgery related to the will or trust document, or the destruction of said documents

Inheritance theft can also happen on a more personal level. Say you and your sister share caregiving duties for your aging mother. Your sister has access to your mother’s bank accounts and, without your knowledge, withdraws a large amount of cash from them while your mother is still living.

Meanwhile, your mother names you as executor of her will. Once she passes away, you begin creating an inventory of her assets only to discover that money is missing from her bank accounts. If you and your sister were supposed to have inherited those assets jointly, this could constitute a violation of your state’s inheritance theft laws.

Is Stealing Inheritance a Crime?

People who commit inheritance theft, whether it’s an executor, trustee, beneficiary or someone else, may be subject to both criminal and civil penalties. For example, a trustee who embezzles money from someone’s estate can be charged with a felony or misdemeanor, depending on state laws. They can also be sued by the beneficiaries of the trust for breach of fiduciary duty.

Likewise, a caregiver who steals money from someone’s bank accounts or coerces them into signing over other assets could be charged with a felony or misdemeanor crime. Typically, whether a felony or misdemeanor charge is brought depends on the nature of the theft and the value of what was stolen. Felony convictions can result in a prison sentence, while the punishment for misdemeanor convictions is typically jail time and/or fines.

The injured parties, i.e. someone’s heirs or beneficiaries, may also choose to pursue a civil claim against someone they believe has stolen their inheritance. Going back to the previous example, you may decide to sue your sister for the money that was taken from your mother’s bank account. If you win a judgment, she would be forced to repay your share of those assets, along with your attorney’s fees.

Inheritance Theft Laws

Each state has different laws regarding inherited assets, but they’re all designed to do the same thing: protect the rights of people who inherit assets. State inheritance theft laws typically cover four distinct aspects:

Who has committed the inheritance theft (i.e. a family member, friend, caretaker, etc.)
When the theft occurred (i.e., before or after the owner of the assets passed away)
What was stolen (i.e. bank accounts, real estate, jewelry, etc.)
How the theft occurred

As far as the “how” goes, it’s important to remember that inheritance theft can take many different forms. One of the most common examples involves elder financial abuse, in which someone takes advantage of an elderly person’s weakened physical or mental state to steal from them. This is something to be aware of if you have aging parents and someone else is their primary caregiver.

What Can You Do If Someone Steals Your Inheritance?

If you believe someone has stolen your inheritance, it’s important to review inheritance theft laws in your state. Again, each state has different guidelines regarding:

What constitutes inheritance theft
Who has the standing to bring a civil claim or file a criminal complaint in connection with a stolen inheritance
What the legal grounds are for successfully pursuing an inheritance theft claim
Which penalties and remedies apply for inheritance theft

Talking with an experienced estate planning attorney can help you determine if you have standing and grounds to file a claim for inheritance theft. Your attorney may advise you to take certain steps to develop a case, including:

Taking an inventory of the estate’s assets
Reviewing estate documents, such as wills or trusts, to look for any potential signs of fraud or forgery
Verifying the validity of will or trust documents

In the case of a larger estate, it may be necessary to hire a forensic accountant. Forensic accountants specialize in examining financial documents, which may be helpful if you’re struggling to create a paper trail to prevent inheritance theft.

You could also reach out directly to the person that you believe stole the inheritance, though your attorney may or may not advise you to do this. If the person is aware that you’re pursuing a civil claim or criminal case against them, they may be willing to return any stolen assets to avoid legal trouble. But if your request is unsuccessful, you may have no choice but to pursue a civil or criminal case.

General Tips to Protect Your Inheritance

Protecting an inheritance starts with understanding how it is structured and where it is held. If you are named as a beneficiary, make sure you have copies of all relevant estate documents, such as the will, trust, or beneficiary designations. Keep communication open with the executor or trustee, so you can stay informed about how the estate is being managed. Having clear documentation and records can help prevent misunderstandings or misuse of assets later.

Consider working with qualified professionals to safeguard your inheritance. An estate planning attorney can explain your legal rights as a beneficiary and help you address concerns about how the estate is being handled. Meanwhile, a financial advisor can assist with managing or investing inherited assets in a way that aligns with your goals. In some cases, hiring an accountant may also be helpful for tracking transactions or handling complex tax issues related to inherited property.

Maintaining good organization and oversight is another important step. Keep detailed records of all communications, asset valuations and distributions. If you notice irregularities, such as missing assets, unexplained withdrawals or delays, document your concerns right away and raise them with the executor, trustee or your attorney. Acting quickly is often key to recovering or protecting assets if theft or mismanagement occurs.

Lastly, think ahead about how to protect future inheritances within your own estate plan. If you expect to pass assets to others, consider using tools like trusts to control how and when heirs receive funds. Naming reliable executors or trustees and reviewing your estate documents regularly can also prevent disputes and reduce the chance of mismanagement after your death. Taking proactive steps now helps secure your legacy and minimize potential conflicts later.

Bottom Line

Legal recourse is available for victims of inheritance theft, including filing a lawsuit to recover stolen assets or contesting a will in probate court. It’s essential to act swiftly in these situations, as statutes of limitations can restrict the time frame for legal action. Consulting with an attorney who specializes in estate law can provide invaluable guidance and increase the likelihood of a favorable outcome.

Estate Planning Tips

Consider talking to a financial advisor about what to do if someone steals your inheritance or how you can protect your heirs and beneficiaries from theft. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
If you disagree with the way an executor or trustee is managing an estate, you could take steps to remove them – even if no theft has occurred. And there may be situations where you might feel it necessary to contest someone’s will or a trust if you believe that it’s in some way invalid or that a breach of fiduciary duty has occurred on the part of the trust. In those situations, it may be helpful to talk with an estate planning attorney to discuss whether you might be able to challenge a will or trust.