Minneapolis Probate Lawyer What To Do if You Don’t Want What Is Left To You
There was a time, in the not too distant past, when inheriting something was a benefit and nothing but good news. But, with the crash of ’07 and the subsequent plummeting of real estate values, that’s no longer true.
Probate lawyers such as myself are increasingly answering the question: What if I don’t want it?For instance, what happens if your eldest son doesn’t want the family vacation home that you’ve left to him? Or your sister decides that the condo you so lovingly cared for isn’t worth the headache because it’s under water?
First, no one is REQUIRED to accept an inheritance. Most heirs or beneficiaries are free to reject the bequest. When a beneficiary rejects a bequest it is technically, or legally, referred to as a “disclaimer.” This is the legal equivalent of simply saying “I don’t want it.” One crucial rule about rejecting an inheritance is that the person who rejects the bequest cannot direct where it then goes. Legally, it will pass as if the person rejecting it died before you. Thus, who it passes to depends upon what your estate planning documents, such as a will, trust, or beneficiary form, say will happen if the primary named beneficiary is not living.
Now you may be thinking why on earth would someone reject a generous sum of money or piece of real estate? There could be several reasons why a beneficiary might not want to accept such a bequest.
1. The named beneficiary may prefer that the asset pass to the next named beneficiary. Perhaps that is their own child and they decide they do not really need the asset but their child could make better use of it.
2. The beneficiary may have a large and valuable estate of his or her own and does not need the money. By rejecting or disclaiming the bequest it will not increase the size of the named beneficiary’s estate and thus, it may lessen the estate taxes due upon their later death.
3. What if the asset needs a lot of upkeep or maintenance, as with a vacation home or classic car? The person named to receive that asset may decide taking on that responsibility is simply not something he or she wants to do. By rejecting or disclaiming the asset, the named beneficiary will not inherit the “headache” of caring for, and being liable for, the property.
4. A common scenario right now is someone inheriting a home that is under water. Selling it may require thousands of dollar in repair/upgrades that the beneficiary simply doesn’t have and they aren’t interested in assuming a mortgage on a home that is treading water. Instead, they simply choose to walk away.
A knowledgable estate planning attorney can guide you by setting up your plan to leave specific assets to beneficiaries who are in the position to receive them as you intended. We all feel that leaving something to someone is a gift, work with Unique Estate Law to keep it that way.