Nearly every state charges incarcerated and formerly incarcerated people costs, such as room and board, medical fees, and transportation costs – also known as “pay-to-stay” fees. If these fees are not paid, the government can seize a person’s inheritance to satisfy their pay-to-stay fees.
This report outlines three primary concerns with these practices. First, pay-to-stay fees function as a regressive tax levied disproportionately on working-class families, who face higher rates of pre-trial detention due to inability to pay bail, which result in longer stays and higher fees. Second, seizing inheritances disproportionately affects Black families and communities of color, who are less likely to have estate plans to protect inheritances. Third, both pay-to-stay fees and seizing inheritances undermine successful re-entry and increase the risk of financial destitution. Formerly incarcerated people face substantial barriers to employment and housing. When states seize their assets, they eliminate what may be the only available on-ramp to stable housing and financial stability.
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Findings:
- The bottom half of U.S. households receive an average inheritance of only $9,700, with three-quarters receiving no inheritance at all.
- 45 percent of wealth for Black households is tied to home equity, compared to only 19 percent for white households.
- Nearly half of all states potentially authorize seizing inheritances to collect these debts, with three states explicitly permitting the practice. However, Illinois, New Hampshire, and Missouri, have repealed their pay-to-stay statues in recent years.
Recommendations:
- Stop charging incarceration costs. Repeal statues that charge pay-to-stay fees.
- Stop seizing inheritances to pay for pay-to-stay fees entirely. If a full repeal is not possible, exempt the first $100,000 of an estate from seizure.
- Set time limits for the collection of pay-to-stay fees, including inheritance seizures, after a set number of years following the completion of an incarceration sentence.
- Track the demographics of individuals facing pay-to-stay fees and inheritance seizures, including total assets seized.
- Track the amount of pay-to-stay fees and inheritances seized, as well as the types of assets seized.