California Estate Planning Attorney Explains How A Qualified Disclaimer Can Keep The Irs At Bay

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One little-known estate planning tool is called a qualified disclaimer, in which the beneficiary of an estate can renounce his/her part of an inheritance and pass it along to his/her heirs, who may be in a better position to utilize the inheritance.

This is done for many reasons. It can be utilized by estate planning attorneys to allow individuals and couples to refuse an inheritance and pass it along to their own heirs, as though they predeceased the person granting the inheritance.

One scenario would be parents who are financially well-off receiving an inheritance from their parents or a deceased child. If they do not need the money, or if it would complicate their estate plan, they can choose to use a qualified disclaimer to pass the inheritance along to their heirs, in this case their surviving children and avoid the estate tax that would be levied upon their death.

There are very specific federal tax rules for this transaction, and an estate planning attorney is critical to help you navigate the process. The requirements are 1) the disclaimer must be irrevocable and unqualified; 2) it must be in writing; 3) the writing must be received by the one who is conveying the property; 4) it must be received within nine months after the transfer; 5) the disclaimer must be made prior to acceptance of any benefits; and 6) the estate must pass directly without any involvement by the person making the disclaimer.

Another estate planning option would be for the surviving spouse to disclaim an interest in the estate of a spouse and pass that directly to the children, which may lower the estate tax bill on the estate. Check with an estate planning attorney before deciding to move forward with this strategy.

Estate planning attorneys can also tell you if the disclaimer is valid for state taxes as well as federal taxes. Each state is different, and you should seek out a certified estate planning specialist familiar with the laws of your state before making any changes to your estate plan.

If you would like more information about how a qualified disclaimer can keep the IRS at bay, check online for comprehensive resources for personal wealth management solutions for personal wealth management solutions through estate planning, wills, and revocable trusts.

Whether your estate planning goals are immediate or long-term, a qualified California estate planning attorney will be able to counsel you on the best options available to you to meet your individual needs.

About the Author:
Kevin Von Tungeln is the Managing Partner of EstatePlanningSpecialists.com and Thompson Von Tungeln, P.C. Kevin practices exclusively in the areas of estate planning, probate, wills, conservatorships and trust administration.Visit www.EstatePlanningSpecialists.com or www.linkedin.com/in/kevinvontungeln to learn more.



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