Key Rules And Pitfalls To Execute Qualified Disclaimers Successfully, With Dave Haughton

The gist

1. Haughton says a qualified disclaimer must be in writing, made within 9 months of death, before accepting the property, and without directing where it goes.
   Qualified Disclaimer
2. Haughton warns that withdrawals, changing investments or depositing dividends can count as acceptance, though a required year-of-death RMD usually does not.
3. Disclaimed assets pass as if the heir had died first, but Haughton says spouses can disclaim into a credit shelter trust they still benefit from.
4. Haughton's sequence is to ask whether they can disclaim, where the asset goes, and whether they should, since Medicaid's 5-year look back may treat it as a gift.
5. Haughton advises building disclaimers into estate plans because the $15 million federal exemption could change, and Massachusetts taxes estates over $2 million without portability.