As a NJ resident, can I waive my right to receive more than $25,000 from my late mother-in-law's PA estate and redirect it?

Asked almost 2 years ago - Grenloch, NJ

As a class C beneficairy in NJ I want to avoid the 11% inheritance tax on amounts over 25,000.
and instead direct that the remainder be divided among my three children who are my MIL's grandchildren.

Additional information

My spouse is deceased. An d don't want to rescind the entire bequest - just the amount that would be taxable.

Attorney answers (4)

  1. Lawrence A Friedman

    Contributor Level 18

    11

    Lawyers agree

    Answered . Yes, but you wouldn't accomplish your goal. NJ inheritance tax applies where a decedent was domiciled in NJ. Apparently, you are saying your MIL resided in PA, in which case NJ inheritance wouldn't apply but PA inheritance tax would apply. Even MIL was an NJ resident but had real estate in PA, NJ inheritance tax wouldn't apply to the PA real estate but PA non-resident inheritance tax would apply. To answer your speciofic question, an individual can disclaim an inheritance by following appropriate legal procedure for the state in which the disclaimed asset is considered situate (which sometimes is tricky to determine). However, a disclaimer causes an asset to pass as if the disclaimant died. If you want to direct where an asset goes, you would have to make a gift rather than a disclaimer and you would be treated for tax purposes as having received the asset and then gifted it, which could result in double tax exposure. I'd suggest consulting counsel to learn your options.

    Lawrence Friedman, Bridgewater, NJ. Certified as an Elder Law Attorney by the ABA approved National Elder Law Foundation, former Chair NJ State Bar Association Elder and Disabilities Law Section, Member Board of Consultors of NJSBA Real Property, Trusts & Estates Law Section, Vice Chair Special Needs Law Section of National Academy of Elder Law Attorneys, and Master of Laws (L.L.M.) in Taxation from N.Y.U. School of Law. Visit SpecialNeedsNJ.com for articles and Q&A on elder law, special needs, wills, trusts, estates, and tax and SpecialNeedsNJ.com/blog for timely updates. Information on both Avvo and SpecialNeedsNJ.com does not constitute legal advice, as it is general in nature and may not apply to your situation or be subject to important changes. No attorney client relationship exists unless set forth in written engagement terms.

  2. Richard Albert Luthmann

    Pro

    Contributor Level 14

    9

    Lawyers agree

    Answered . If you disclaim the inheritance, the assets pass as if you had pre-deceased the decedent. This may mean that the amounts pass to your spouse and not your children. It may also mean that the bequest will lapse in its entirety. I would take a copy of the will to a local estate planning attorney so that you are sure that your actions will achieve the desired result.

    This answer is made for educational purposes only. By using or participating in this site you understand that... more
  3. Matthew Erik Johnson

    Contributor Level 17

    6

    Lawyers agree

    Answered . You can refuse your inheritance, but if you do so the Will and intestate succession will determine who gets the money. You will not be able to direct the inheritance to whomever you want.

    Matthew Johnson phone# 206.747.0313 is licensed in the State of Washington and performs bankruptcy, short sale... more
  4. Steven M Zelinger

    Pro

    Contributor Level 20

    2

    Lawyers agree

    Answered . Additionally, if I understand the situation correctly, as a PA estate, if the property went to descendents (grandchildren) it would still be subject to PA inheritance tax of 4.5%

    This is not legal advice nor intended to create an attorney-client relationship. The information provided here is... more

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