Definition - What does Direct Inheritance mean?
A direct inheritance is an inheritance that is given directly to a beneficiary. It does not go through a trust and it is not held in a bank account. If a person gets a direct inheritance, they may be unable to claim social security because it is seen as income. There is no limit on how much a person can inherit through a direct inheritance. This is the opposite of when the goal of an estate is to liquidate all assets and split the proceeds between all beneficiaries.
Justipedia explains Direct Inheritance
People perform direct inheritances in part to ensure that the tax obligation is lessened for the beneficiary. A direct inheritance can pass to a beneficiary before or after a person's death. Any asset can be directly inherited. However, if an asset has any debt attached to it, the debt would be inherited as as well. An example of this is a family home which has a mortgage or a business with continuous outgoings.