Disclaimers

Reasons to Disclaim

1. Onerous Burdens

Reasons to Disclaim

1. Onerous Burdens

2. Tax Savings

Possible Reasons to Disclaim1. Onerous Burdens

2. Tax Savings

3. Avoid creditors, except IRS Child support▪ As of 1/1/14▪ EC § 122.107

RequirementsPC § 37A; EC § 122.1071. Disclaimer Document

a. Written,

b. Acknowledged, and

c. Statement whether disclaimant owes back child support [as of 1/1/14]

RequirementsPC § 37A; EC § 122.0552. Proper Filing

a. When = 9 months after decedent’s death

RequirementsPC § 37A; EC § 122.0522. Proper Filing

a. When = 9 months after decedent’s death

b. Where = in court where probate proceedings pending

RequirementsPC § 37A; EC § 122.0563. Notice to personal

representative by

a. Personal service, or

b. Registered or certified mail.

Basic Disclaimer Principles1. Wills, life insurance policies,

etc. may provide disclaimer methods and designate who receives disclaimed property.

Basic Disclaimer Principles2. Irrevocable

Basic Disclaimer Principles3. Partial disclaimers (“cherry-

picking”) allowed.

Basic Disclaimer Principles4. Acceptance precludes later

disclaimer.

Basic Disclaimer Principles5. Disclaimed property passes

as if disclaimant predeceased decedent.

Disclaimant cannot control where property goes.

Treated as legally dead although biologically alive vis-à-vis the disclaimed property.

Welder v. Hitchcock – p. 51

Situation

Husband died intestate survived by his wife and their four children.

All children want wife/mother to receive all husband/dad’s property.

They all execute valid disclaimers.

Result??

Basic Disclaimer Principles6. Lack of understanding of

effect of disclaimer (e.g., who receives the disclaimed property) ≠ ground for undoing

Basic Disclaimer Principles7. Lack of understanding of

what property is being disclaimed = ground for undoing