Over the next few decades, Americans are expected to pass along trillions of dollars in wealth from one generation to the next. As these assets change hands, not every transfer goes as planned. Unclaimed inheritances, when someone dies and no one receives their property, are more common than many people realize.
Here's a look at what happens in this scenario as well as some of the rules around intestate succession.
How Does an Inheritance Work?
When someone passes away, everything they own becomes part of their estate. These assets are transferred to beneficiaries as an inheritance.
Most people outline their wishes in a will. This legal document explains who should receive specific property after death. Once the will owner passes away, a state court reviews the document through a process called probate. After probate, assets are distributed based on the instructions in the will.
Some assets do not require a will. Certain financial accounts allow the owner to name a beneficiary directly, including:
- Life insurance policies
- Retirement accounts
In these cases, the named beneficiary receives the death benefit or account assets after the owner passes away.
What Is an Unclaimed Inheritance?
An unclaimed inheritance is property that is not transferred to a beneficiary after someone dies. This can include financial assets such as cash, bank accounts, stocks, and real estate. It may also include personal belongings like furniture, clothing, or jewelry.
While uncommon, an inheritance can go unclaimed for several reasons.
Common Reasons an Inheritance Goes Unclaimed
- No Inheritance Instructions: If someone dies without a will, they die intestate. In this situation, courts distribute property based on state intestate succession laws. The process starts with immediate family members such as a spouse or children and moves outward to more distant relatives. If no eligible beneficiary can be identified, the property remains unclaimed.
- The Named Beneficiary Has Passed Away: If the beneficiary listed in a will or account has already died, the court follows state law and the terms of the will to identify the next beneficiary. When no alternative can be found, the inheritance goes unclaimed.
- Beneficiaries Are Unaware of the Asset: Financial institutions and insurance companies must be notified of a death before releasing funds. If beneficiaries do not know an account or life insurance policy exists, they may never file a claim.
- Beneficiary Declines the Inheritance: Some beneficiaries choose not to accept an inheritance, especially when it involves complex assets like real estate. If there is no backup beneficiary, the property remains unclaimed.
What Happens to an Unclaimed Inheritance?
When an inheritance goes unclaimed, the probate court and state government try to locate an heir. If no one is found, the property may end up with a government agency.
Common outcomes include:
- State Unclaimed Property Agencies: Each state runs an unclaimed property agency that holds money and assets until an eligible heir is identified. Individuals can search these databases using their personal information to check for unclaimed property.
- Financial Institutions Transferring Assets: If a bank, insurance company, or other financial institution learns that a client has died and no beneficiary is listed, the account balance or property is sent to the state unclaimed property agency.
- Federal Agencies in Specific Cases: Some unclaimed property may go to federal agencies. For example: The Department of Veterans Affairs may hold an unclaimed life insurance policy for a veteran. Additionally, the Internal Revenue Service may hold an unclaimed tax refund.
Most unclaimed inheritances are ultimately held by state governments until a rightful heir comes forward.
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How Much Inheritance Money Goes Unclaimed?
The National Association of Unclaimed Property Administrators estimates that about 1 out of 7 Americans is owed some type of unclaimed property, including inheritances. In the 2025 fiscal year, unclaimed property programs returned roughly $4 billion to rightful owners.1
Even so, state governments still hold large amounts of unclaimed money and property. In New York, the state returned $580 million in unclaimed funds in 2025.2
While many unclaimed inheritances total only a few hundred or a few thousand dollars, there have been cases where people uncovered lost inheritances worth six figures or more.
Four Ways to Find Unclaimed Inheritance
If you think you may be owed an unclaimed inheritance, the first step is locating the property. Here are four methods to consider.
1. Search the Deceased’s Paperwork for Clues
Look through your loved one’s mail, files, and other records for signs of financial accounts or property. This may include bank statements, bills, or a life insurance policy. These documents can confirm the asset existed and identify the company that held it.
Once you have this information, contact the company directly. If they were not aware of the death, they may still hold the asset. If the property was transferred to a government agency, this helps narrow where to continue your search.
2. Use a Free Unclaimed Inheritance Search
Several websites allow you to search for unclaimed inheritance at no cost. You typically enter your name and the deceased’s name to see whether any property was turned over to a government agency. You can also search the unclaimed property office in the state where your loved one lived.
When searching, consider whether the deceased lived at multiple addresses or used different names. Running more than one search may help.
3. Try National Organizations
Most unclaimed property is held by state offices, but some assets are transferred to federal agencies.
The federal government provides a directory of national organizations you can search.3 Choose the agency that best matches the type of property you are looking for, such as the Internal Revenue Service for an unclaimed tax refund or TreasuryHunt.gov for savings bonds.
4. Consider Hiring a Professional
If free government searches do not turn up results, you may consider hiring a professional service or attorney. These providers usually charge a fee, even if no property is found.
This option may make sense only if you believe the missing assets are significant enough to justify the cost.
How Can I Claim a Missing Inheritance?
If you find lost money or property from a deceased loved one, contact the state agency or company holding it to start the claims process. They will explain which forms to complete and what documentation is required. You will need proof of identity, such as your Social Security number, along with records showing you are entitled to the property.
Documents that can support your claim:
- Proof of identity
- A copy of the deceased's will naming you as an heir
- Documentation showing you qualify under state intestate succession laws, if there is no will
If there is no will, you must show that you qualify under your state’s intestate succession laws, such as being a spouse or child. If you are not a legal heir and there is no will, you generally cannot claim the property.
Once you submit the claim and required documents, the agency or company will review your request. If approved, the money or property will be transferred to you.
Is There a Time Limit?
The time you have to claim an inheritance depends on state law.
For example, California allows three years for individuals to claim unclaimed property. After that, the state considers the property abandoned and transfers the funds to the state. Physical items, such as real estate or jewelry, may also be sold.
Even after this happens, your right to claim the inheritance does not end. If you can show that you were entitled to the inheritance, the state can still pay what is owed. Starting the process sooner can help keep it less complicated.
What If I Don't Want the Inheritance?
If you receive property from a deceased loved one that you do not want, you have a few options.
Option 1: Disclaim the Inheritance
You can formally refuse the inheritance. This is called disclaiming. The property then passes to the next beneficiary in line.
- If the will or insurance policy names a backup or secondary beneficiary, that person receives the property.
- If no backup is named, the state follows intestate succession rules to determine the next beneficiary.
Option 2: Accept and Give It Away
You can accept the inheritance and then give it to another family member or a charity. This allows you to choose who receives it.
- A possible drawback is exposure to estate or gift taxes.
- These taxes generally apply only when large amounts are involved.
How Can My Estate Plan Avoid Problems?
A well-designed estate plan can help prevent inheritances from getting lost. These steps can make things easier for your loved ones.
Create a Will With Clear Instructions
A will helps reduce issues tied to lost inheritances. It outlines what you own and who should receive it. Listing backup beneficiaries can help if your first choice is no longer living.
Use Beneficiary Instructions When Available
Life insurance policies, retirement plans, and brokerage accounts often allow beneficiary designations. These assets usually pass directly to beneficiaries and do not go through probate, which can speed up the process and reduce confusion.
Keep Your Plan Up-to-Date
Review your estate plan regularly, such as once a year. Confirm beneficiaries are still accurate, update instructions as needed, and add any new property you own.
Share Information With Loved Ones
Beneficiaries should know where to find your will and how to locate financial accounts, insurance policies, property deeds, and other valuable assets. This helps prevent inheritances from being overlooked.
Consider a Trust
A trust is a legal entity that holds property. You can transfer assets into a trust during your lifetime and provide instructions for how they should be distributed later. Trusts require setup and ongoing costs, but they can simplify property transfers and reduce the risk of lost inheritances.
For guidance on locating unclaimed property, making a claim, or setting up an estate plan, consider meeting with a financial professional.
Final Thoughts
Unclaimed inheritances can happen for many reasons, but they are often recoverable with the right steps and documentation. Understanding how inheritances work, where unclaimed property is held, and how to search for it can help you avoid leaving money or assets behind. Planning ahead with a clear, updated estate plan can also help reduce confusion and make it easier for your loved ones to receive what you intended.
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Sources
- Unclaimed Property Day – February 1st. https://unclaimed.org/unclaimed-property-day/.
- Unclaimed Funds. https://www.osc.ny.gov/unclaimed-funds.
- How to find unclaimed money from the government. https://www.usa.gov/unclaimed-money.
