Is state entitled to any money leftover from my mom’s life insurance policy payout?

It depends on the circumstances. In general, life insurance proceeds are paid directly to the beneficiaries named in the policy, and are not subject to probate or estate taxes. However, there are some situations where the state may be entitled to a portion of the life insurance proceeds. For example:

• If the deceased owed money to the state, such as unpaid taxes or other debts, the state may be able to make a claim against the life insurance proceeds to satisfy those debts.
• If the deceased was receiving government benefits, such as Medicaid, at the time of their death, the state may be entitled to recover some or all of the benefits paid on their behalf. This is known as Medicaid estate recovery, and it allows the state to recover funds from the deceased person's estate, including life insurance proceeds.
• If the deceased did not name any beneficiaries or if all of the named beneficiaries have predeceased them, the life insurance proceeds may become part of the deceased person's estate and be subject to probate. In this case, any debts or taxes owed by the estate would need to be paid before the remaining funds are distributed to the heirs.

It's important to note that life insurance laws and regulations can vary by state, so it's recommended to consult with an attorney or financial advisor for guidance specific to your situation.