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Decline inheritor initial

hi everyone today i want to talk to you about whether or not you can refuse an inheritance so why would anyone want to refuse an inheritance you might be thinking although it's surprising to many there's several circumstances when declining an inheritance can be beneficial the law does permit you to refuse an inheritance if you comply with certain strict requirements the legal term for a refusal of an inheritance is a disclaimer which is defined as an irrevocable and unqualified refusal to accept an interest in the property let's talk about when disclaiming an inheritance may be beneficial the first reason would be to avoid or reduce the estate or gift or income taxes in 2020 the federal estate tax exclusion was over 11 million dollars for an individual in over 22 million for a married couple this means that only estates that exceed this amount would be subject to that estate tax but most people do don't have such a sizable estate so using a disclaimer to avoid federal estate taxes is less common now than it was in the past and who knows if that those numbers will change as they do change frequently and they're set to come back down again however in some states like in massachusetts there's an estate tax that has a left much lower value and that's if an estate goes over a million dollars so if your estate will be subject to those taxes disclaiming an inheritance may make sense if the next beneficiary in line as named in the will or under state law is taxed at a lower rate than you in addition a disclaimer provides a way for you to provide a gift to the next beneficiary in line without having to worry about the gift tax if you decide to disclaim an inheritance for tax purposes it is considered to have never belonged to you obviously you could not make a gift of something that was never yours as a result it does not count towards your annual gift tax exclusion of over fifteen thousand dollars for an individual or thirty thousand for a married couple or your lifetime exclusion amount of eleven over eleven million dollars for an individual if your inheritance is an asset that produces income such as an ira it will likely shift you into a higher tax bracket a disclaimer may be beneficial if you don't need that extra income of course the next beneficiary in line will also benefit especially if that person is in a lower tax bracket another example of where disclaiming an inheritance may be beneficial is about refers to the eligibility for certain benefit programs if you're trying to qualify for certain government benefits at some point in the future and the inheritance would jeopardize your eligibility disclaiming the inheritance may enable you to become eligible now there's a little bit of a warning here for some benefit programs an effective disclaimer must occur several years...