Disclaimer Trust
A disclaimer trust allows a beneficiary to refuse assets to manage tax implications while retaining estate planning flexibility.
When might a family use a disclaimer trust in estate planning?
A disclaimer trust can be beneficial when a beneficiary wants to avoid inheriting assets that could push their estate into a higher tax bracket. It offers a way to redirect those assets within a predetermined plan without incurring gift taxes. This is often used in situations where estate tax laws have changed since the will was written, or where a beneficiary's financial situation suggests other family members might better utilize the inheritance. By disclaiming assets, the beneficiary allows them to pass to another heir or trust setup under the estate, potentially lowering tax liabilities and optimizing the management of an estate.
