An inheritance is an important family legacy that can provide a safety net for future generations. For working families struggling to keep up with rising living costs, the transfer of a family home or other inheritance can provide newfound economic security. In particular, the anticipated wealth transfer from the Baby Boomer generation to their heirs — estimated to be over $50 trillion — has the potential to provide millions of families with improved financial stability.
The hard-earned wealth of working-class families, however, has become increasingly vulnerable. Affluent families are often better situated to protect and transfer their wealth using legal tools such as trusts or business entities. By contrast, working-class families’ wealth — the majority of which is held as home equity — is far more precarious and often vulnerable to seizure to cover health care costs and other expenses before it can be passed on and can face additional threats when transferred.
One example of the precarity of working-class intergenerational wealth arises in the criminal-legal context. More than half of states potentially authorize seizing the inheritances of incarcerated or formerly incarcerated people to pay for the costs of their own incarceration, known as “pay-to-stay” fees. Nearly every state charges incarcerated people these pay-to-stay fees, which may include charges for room and board, medical expenses, and other necessities.
A recent study by Professor Brittany Deitch found that, of the states that charge individuals for incarceration-related expenses, three expressly authorize seizure of inheritance assets and 25 may potentially permit it.
These seizures of inheritances for pay-to-stay fees may occur decades after a person served their sentence and can jeopardize financial stability in old age. Connecticut resident Teresa Beatty, for instance, received a bill for over $83,000, stemming from a two-year incarceration that ended 20 years prior, when her mother passed away and left her a portion of the family home.
Pay-to-stay laws and, in particular, the seizure of family inheritances to cover pay-to-stay fees, exacerbate an already wide chasm between the haves and have-nots, causing poor families to grow poorer as rich families continue to grow richer.
Seizing family inheritances to pay for incarceration causes particular harm to Black communities. Due to widespread inequities across the criminal justice system, as well as historic disinvestment in Black neighborhoods, Black families have less wealth available to pass to their heirs and are more likely to lose what little wealth they manage to build to the government to pay for the costs of operating prisons and jails. Moreover, seizure of resources to collect pay-to-stay fees can make it harder for returning citizens to achieve the financial stability necessary to reintegrate into society and avoid reincarceration.
Constitutional challenges to pay-to-stay fees have largely been unsuccessful, but reformers have made progress through several state legislatures. Illinois, New Hampshire, and Missouri have repealed their pay-to-stay statutes in recent years. Additionally, in 2022, Connecticut partially reformed its pay-to-stay laws, exempting incarcerated individuals from paying the first $50,000 of their incarceration costs and collecting only from individuals convicted of “serious crimes.”
State policymakers have an important role to play in reforming the laws that sentence formerly incarcerated people and their families to generations of debt. In addition to an analysis of the disparate harm that pay-to-stay laws and inheritance seizures have on low-income and Black communities. This paper provides recommendations to state lawmakers on how to end or alleviate the punishing impact of incarceration fees.
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