Additional Information:

I am trustee of my fathers estate. I have attempted to communicate with one of the beneficiaries who was left a designated amount but she refuses to reply to my letters. I have been told by a family member that she does not want the money but as stated, I have received no replies to my letters.

ATTORNEY ANSWER:

A beneficiary is always free to refuse to accept benefits under a trust or a will. You should ask the beneficiary to execute what is called a disclaimer. Once a beneficiary disclaims her interest, she is treated as predeceasing the Donor of the trust and you are free to distribute the bequest to the next beneficiary in line. The beneficiary may be willing to sign a disclaimer as she does not wish to accept the bequest. The disclaimer would protect you as Trustee from a breach of a fiduciary duty by distributing the assets to a different beneficiary.

A second issue arises over the amount of the bequest. If this is a substantial amount, the beneficiary would need to execute a “Qualified Disclaimer” as laid out in the Internal Revenue Code. By executing a Qualified Disclaimer, any amount the beneficiary disclaims will not be deducted from the beneficiary’s state or federal estate tax exemption amounts. The state exemption amount is determined under the laws of the state of the beneficiaries domicile.

A Qualified Disclaimer does have a time limit associated with it. The beneficiary would have it sign it within 9 months from the date of the Donor’s death. The Qualified Disclaimer must also follow the requirements as laid out in the Internal Revenue Code, one of which is that it complies with state law. An estate attorney who is licensed in the beneficiary home state would be able to draw up one for the beneficiary for a small fee.

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The attorneys at The Beliveau Law Group provides legal services for estate planning (wills and trusts), Medicaid (planning and applications), probate (estate and trust administration), business law (formation and operation), real estate (residential and commercial), taxation (federal and state), and civil litigation (in connection with these practice areas). The law firm has offices and attorneys in Naples, Florida, Waltham, Massachusetts, and Salem, New Hampshire.