- INITIAL STEPS TO THE ESTATE ADMINISTRATION PROCESS
- Understanding the Laws of Intestacy
A good place to start understanding intestate succession is the statute, Tenn. Code Ann. § 31-2-104.
(a) The intestate share of the surviving spouse is:
(1) If there is no surviving issue of the decedent, the entire intestate estate; or
(2) If there are surviving issue of the decedent, either one-third ( ⅓ ) or a child’s share of the entire intestate estate, whichever is greater.
(b) The part of the intestate estate not passing to the surviving spouse under subsection (a) or the entire intestate estate if there is no surviving spouse, passes as follows:
(1) To the issue of the decedent; if they are all of the same degree of kinship to the decedent they take equally, but if of unequal degree, then those of more remote degree take by representation;
(2) If there is no surviving issue, to the decedent’s parent or parents equally;
(3) If there is no surviving issue or parent, to the brothers and sisters and the issue of each deceased brother and sister by representation; if there is no surviving brother or sister, the issue of brothers and sisters take by representation; or
(4) If there is no surviving issue, parent, or issue of a parent, but the decedent is survived by one or more grandparents or issue of grandparents, half of the estate passes to the paternal grandparents if both survive, or to the surviving paternal grandparent or to the issue of the paternal grandparents if both are deceased, the issue taking equally if they are all of the same degree of kinship to the decedent, but if of unequal degree those of more remote degree take by representation; and the other half passes to the maternal relatives in the same manner; but if there is no surviving grandparent or issue of grandparent on either the paternal or maternal side, the entire estate passes to the relatives on the other side in the same manner as the half.
Tenn. Code Ann. § 31-2-104
Further defining this succession scheme is Tenn. Code Ann. § 31-2-106.
If representation is called for by this title, such representation shall be per stirpes.
Tenn. Code Ann. § 31-2-106
While comprehensive in many ways, it is not the only statute that governs intestate succession in Tennessee. The parent child relationship is also defined in Tennessee law.
(a) If, for purposes of intestate succession, a relationship of parent and child must be established to determine succession by, through, or from a person:
(1) An adopted person is the child of an adopting parent and not of the natural parents except that adoption of a child by the spouse of a natural parent has no effect on the relationship between the child and that natural parent; and
(2) In cases not covered by subdivision (a)(1), a person born out of wedlock is a child of the mother. That person is also a child of the father, if:
- The natural parents participated in a marriage ceremony before or after the birth of the child, even though the attempted marriage is void; or
- The paternity is established by an adjudication before the death of the father or is established thereafter by clear and convincing proof, but the paternity established under this subdivision (a)(2)(B) is ineffective to qualify the father or the father’s kindred to inherit from or through the child unless the father has openly treated the child as the father’s, and has not refused to support the child.
(b) In no event shall a parent be permitted to inherit through intestate succession until all child support arrearages together with interest thereon at the legal rate of interest computed from the date each payment was due have been paid in full to the parent ordered to receive support or to the parent’s estate if deceased.
(c) Nothing in this section shall be construed to prevent a child from inheriting from a parent through intestate succession.
Tenn. Code Ann. § 31-2-105
Parent child relationship is defined further in Tenn. Code Ann. § 31-2-107.
Relatives of the half blood inherit the same share they would inherit if they were of the whole blood.
Tenn. Code Ann. § 31-2-107
Wait, there is more. Real property can easily stay intestate, even if the will says something about the house or home.
The real property of an intestate decedent shall vest immediately upon death of the decedent in the heirs as provided in § 31-2-104. The real property of a testate decedent vests immediately upon death in the beneficiaries named in the will, unless the will contains a specific provision directing the real property to be administered as part of the estate subject to the control of the personal representative. Upon qualifying, the personal representative shall be vested with the personal property of the decedent for the purpose of first paying administration expenses, taxes, and funeral expenses and then for the payment of all other debts or obligations of the decedent as provided in § 30-2-317. If the decedent’s personal property is insufficient for the discharge or payment of a decedent’s obligations, the personal representative may utilize the decedent’s real property in accordance with title 30, chapter 2, part 4. After payment of debts and charges against the estate, the personal representative shall distribute the personal property of an intestate decedent to the decedent’s heirs as prescribed in § 31-2-104, and the property of a testate decedent to the distributees as prescribed in the decedent’s will.
Tenn. Code Ann. § 31-2-103 Emphasis mine
When you do draft wills, consider how clear the language must be to ensure the real property is part of the probate estate. If the language is unclear the probate court is not the only place such language will be questioned. Title insurance companies and lawyers will be looking at your wording as well.
You will probably have seen a clause about the rest and residue of an estate in most wills; probably including the form you use. The State has a cure for you if you forget to add that clause and fail to describe every single bit of a persons estate to be.
(a) When any person dies intestate, after the payment of debts and charges against the estate, the deceased’s property passes to the deceased’s heirs as prescribed in the following sections of this chapter.
(b) Any part of the estate of a decedent not effectively disposed of by the deceased’s will passes to the deceased’s heirs in the same manner.
Tenn. Code Ann. § 31-2-101
If the decedent neglected to have any living heirs at the time of their death Tennessee has a way to deal with that as well.
- a) If a decedent, whether or not domiciled in this state, leaves no one to take the decedent’s estate or any portion of the estate by the decedent’s will and no one other than a government or governmental subdivision or agency to take the decedent’s estate or a portion of the estate by intestate succession, under the laws of this state or any other jurisdiction, the estate escheats as of the time of the decedent’s death in accordance with this chapter.
(b) Property passing to the state under this chapter, whether held by the state or its officers, is subject to the same liens, charges and trusts to which it would have been subject if it had passed by will or intestate succession.
Tenn. Code Ann. § 31-6-101
Even when there is a will certain kinds of property may be taken out of the control of the will and distributed differently than how the will directs.
(a)(1) The surviving spouse of an intestate decedent, or a spouse who elects against a decedent’s will, is entitled to receive from the decedent’s estate the following exempt property having a fair-market value (in excess of any indebtedness and other amounts secured by any security interests in the property) that does not exceed fifty thousand dollars ($50,000):
(A) Tangible personal property normally located in, or used in or about, the principal residence of the decedent and not used primarily in a trade or business or for investment purposes, and
(B) A motor vehicle or vehicles not used primarily in a trade or business.
(2) If there is no surviving spouse, the decedent’s unmarried minor children are entitled as tenants in common only to exempt property as described in subdivision (a)(1)(A).
Rights to this exempt property are in addition to any benefit or share passing to the surviving spouse or unmarried minor children by intestate succession, elective share, homestead or year’s support allowance.
(b) Where a deceased dies intestate, leaving a surviving spouse, until letters of administration are granted, the surviving spouse may take into possession and make use of any crop then growing and of the provisions on hand as may be necessary for the support of the surviving spouse and family; the surviving spouse may also use the stock, implements and plantation utensils for the purpose of completing, securing and selling the crop.
(c) The surviving spouse or other custodian of unmarried minor children shall apply for the property named in this section before it is distributed or sold, but the property so delivered shall in no case be liable for the payment of claims against the estate. If the surviving spouse or unmarried minor children do not receive the property allowed under this section and the property is sold by executor or administrator, the court shall order the money to be paid to the surviving spouse or unmarried minor children at any time before the money is paid out for claims or distributed.
(d) Any action to set aside the property designated in this section shall be brought within the limits set by § 31-4-102.
Tenn. Code Ann. § 30-2-101
The surviving spouse’s right to property includes income, or its equivalent.
- In addition to the right to homestead, an elective share under title 31, chapter 4, and exempt property, the surviving spouse of an intestate, or a surviving spouse who elects to take against a decedent’s will, is entitled to a reasonable allowance in money out of the estate for such surviving spouse’s maintenance during the period of one (1) year after the death of the spouse, according to the surviving spouse’s previous standard of living, taking into account the condition of the estate of the deceased spouse. The court may consider the totality of the circumstances in fixing the allowance authorized by this section, including assets that may have passed to the spouse outside probate.
- The allowance so ordered shall be made payable to the surviving spouse, unless the court finds that it would be just and equitable to make a division of it between the unmarried minor children. If there is no surviving spouse, the allowance shall be made to the unmarried minor children.
- The court may authorize the surviving spouse to receive any personal property of the estate in lieu of all or part of the money allowance authorized by this section, and in any case where the court makes an allowance in money, the surviving spouse shall be entitled to select and receive any personal property of the estate, of a value not exceeding the allowance in money, which shall be in lieu of and which value shall be credited against the allowance.
- The allowance authorized by this law is the absolute property of the surviving spouse for these uses and shall be exempt from all claims and shall not be taken into the account of the administration of the estate of the intestate or seized upon any precept or execution.
(e) In determining the amount to be allowed as a year’s support, the court may, in its discretion,
appoint freeholders to set aside that year’s support, as previously required by law.
- If the allowance set by the court as provided in this section is not satisfactory to the surviving spouse electing against the decedent’s will, the surviving spouse of an intestate decedent, the unmarried minor children of an intestate decedent or the personal representative, then appeal may be made to the appropriate court in accordance with § 30-2-609. Proceedings on appeal shall be de novo without the intervention of a jury except when demand for a jury is made in accordance with Tennessee Rules of Civil Procedure, Rule 38; provided, that in jurisdictions where probate matters originate in a court whose judge is also a chancellor, the appeal shall be made as otherwise provided by law; and provided further, that in cases heard in a probate court whose judge is required to have the same qualifications as prescribed for circuit judges, the appeal shall also be made as otherwise provided by law.
(g) Any action to set aside the property designated in this section shall be brought within the time limits set by § 31-4-102.
Tenn. Code Ann. § 30-2-102
While the spousal election is not exactly intestate succession, it is as well to remember that spousal election can, and does, remove property from the scheme of succession envisioned by a will.
(a)(1) The surviving spouse of an intestate decedent who elects against taking an intestate share, or a surviving spouse who elects against a decedent’s will, has a right of election, unless limited by subsection (c), to take an elective-share amount equal to the value of the decedent’s net estate as defined in subsection (b), determined by the length of time the surviving spouse and the decedent were married to each other, in accordance with the following schedule:
If the decedent and the surviving spouse were The elective-share
married to each other: percentage is:
less than 3 years 10% of the net estate
3 years but less than 6 years 20% of the net estate
6 years but less than 9 years 30% of the net estate
9 years or more 40% of the net estate
(2) For purposes of determining the total number of years to be applied to the computation provided in subdivision (a)(1), the number of years persons are married to the same person shall be combined. The years do not have to be consecutive, but may be separated by divorce. All years married shall be counted toward the total number of years for purposes of this section.
(b) The value of the net estate includes all of the decedent’s real property, notwithstanding § 31-2-103, and personal property subject to disposition under the decedent’s will or the laws of intestate succession, reduced by the following: secured debts to the extent that secured creditors are entitled to realize on the applicable collateral, funeral and administration expenses, and award of exempt property, homestead allowance and year’s support allowance. The net estate does not include any assets over which the decedent held a power of appointment, whether exercised or not, unless the decedent exercises the power of appointment to direct the assets to be paid to the decedent’s personal representative for administration as part of the decedent’s probate estate.
(c) After the elective-share amount has been determined in accordance with subsections (a) and (b), the amount payable to the surviving spouse by the estate shall be reduced by the value of all assets includable in the decedent’s gross estate that were transferred, or deemed transferred, to the surviving spouse or that were for the benefit of the surviving spouse, but excluding the homestead allowance, exempt property and year’s support allowance. For purposes of this subsection (c), the decedent’s gross estate shall be determined by the court in the same manner as for inheritance tax purposes pursuant to title 67, chapter 8, part 3, except that the value of any life estate or trust for the lifetime benefit of the surviving spouse shall be actuarially determined.
(d) The elective-share amount payable to the surviving spouse is exempt from the claims of unsecured creditors of the decedent’s estate and, notwithstanding § 30-2-614(b) or (e), shall not be allocated to any United States or any state estate, inheritance or other death transfer tax if the elective share amount qualifies for and is used as a marital deduction in determining the decedent’s death tax liability under any applicable estate, inheritance or other death transfer tax statute.
Tenn. Code Ann. § 31-4-101
- Sample Estate Administration Checklists, Forms and Required Notices Needed
A shorthand estate administration checklist I use is:
Will? If yes, a petition to probate. If no, a petition to administer.
If the estate is under $25,000.00, look at a small estate affidavit.
List of close relatives and addresses and ages
Addresses, ages and current names of beneficiaries
TELL: Will need current filing fee of $289.50 Plus $30.00 Notice of Publication
Check will for waiver of Bond and inform of need to see someone about a bond. Make sure the named fiduciary is bondable. Alternatively, get relatives/beneficiaries to sign waivers of Bond, Inventory, Accounting as possible
Will need an inventory (unless waived) within 60 days so start.
A list of assets and bills
Signed Oath Form, and Oath for Petition to Probate or Administer
Hand copies of waivers, or inform will have to send out and will charge
Date for hearing. If it is simple and no disputes it can be on the Rocket Docket. If not it is before the Judge. PUT the date on the Petition
File the Petition and send a copy – along with the will – to the relatives and beneficiaries
COST BOND and get he client to sign it.
Explain process (hand out revised To do List)
I also use a To Do list for the client, so they have a guide.
AFTER SOMEONE DIES
Make sure you know what the person wanted by way of burial/cremation and do not get talked into more because you are sad your loved one is gone.
Determine if there is a pre-need funeral policy. If so, check what is paid and what is not paid. Some funeral homes like to add on charges after the burial, so get a list of ALL charges and make sure you know what is already paid and what will remain to be paid. If you do not have enough money you can generally assign a life insurance policy where you are the beneficiary to cover the costs. If there is enough money in the estate you may get reimbursed.
If deceased is a veteran or veteran’s spouse, ask the funeral home if Veterans Benefits might pay for some costs. If so, bring anything indicating veteran status as it comes with $300 burial allowance, ability to be buried in veterans cemetery if desired. From the VA:
“Veterans discharged from active duty under conditions other than dishonorable and servicemembers who die while on active duty, active duty for training, or inactive duty training, as well as spouses and dependent children of Veterans and active duty servicemembers, may be eligible for VA burial and memorial benefits including burial in a national cemetery, a headstone to mark the grave of a Veteran interred in a private cemetery or a Presidential Memorial Certificate for loved ones. The Veteran does not have to die before a spouse or dependent child can be eligible.”
- Start getting together a list of immediate family members and how they are related. Look for a Will or a Trust. If you find it notify the lawyer. If you do not find one try to find the attorney the person may have used and check with the clerk of the local probate court to see if a will is on file.
- Check about Life Insurance. If you cannot find a policy, check bank statements for payments to insurance companies. Check with the employer(s) benefits or HR departments. This is a good time to check for any other benefits like survivor’s pension benefits. If that does not work to find a policy, read this article:
- Notify Social Security and the VA. Yes, they are supposed to get word, but do it anyway. There is a one time survivors benefit from Social Security that ought to get paid out, and it can save the surviving spouse from claims for repayment later.
- If the deceased has a will you will do a Petition to Probate. If the will has affidavits of witnesses you do not need to search for them. Otherwise, locate the witnesses if possible and get your lawyer to see if they will give an affidavit. If not, your lawyer will need to subpoena them to come to court on the day of the probate of the will. If the will is holographic (hand written) help your lawyer find two witnesses who can testify to the deceased’s handwriting who are not relatives or beneficiaries. The handwriting witnesses can testify by affidavit.
- If there is no will you will do a Petition to Administer. List relatives like in the petition to probate. If all heirs are at least 18 years old and will sign off, you can waive accounting, bond and inventory.
- When you file bring along another blank check for publication of the “Notice to Creditors.” Currently the lowest price for publication in Davidson County is $30.
- If everything is simple and there are no beneficiaries/heirs who are minors the probate can generally be handled in an expedited basis in Davidson County. If there is anything that might require a judgment call, set the petition for hearing before the judge in Court.
- Open an estate account. Put all the monies from other accounts (except joint accounts) into the estate account unless there is an excellent reason to not do so. To do this you will need an EIN, a copy of the will and Letters Testamentary, or a copy of the Letter of Administration if there was no will.
- Get all the bills and go through bank statements. Clues to benefits and policies can crop up. Also check for safe deposit boxes and other accounts at that person’s bank.
- If the deceased owned a home, the estate can pay for the house expenses for four months. If the estate is going to pay for longer it needs to be authorized in the will, or by the Court. Ask yourself why expenses need to be paid for longer. If there is not a good reason, sell the house after getting court approval. Save yourself time and effort by getting a market report and affidavit from a reliable real estate agent or an appraiser. Ask to be able to sell without specific court approval of the sale price as long as the sale price is $X, or greater.
There is a page on the Davidson County Circuit Court Clerk’s website that has links to really well done instructions to fiduciaries:
There is also a page on the Davidson County Circuit Court Clerk’s website that sets out current fees for doing all things probate:
Other counties have similar pages. For instance Shelby County has the following:
Notices to Creditors are covered in Section IV below.
- Interpreting Provisions and Terms of Art Found in Wills
Sometimes it is just best to see what the law says:
A will shall be construed, in reference to the real and personal estate comprised in it, to speak and take effect as if it had been executed immediately before the death of the testator, and shall convey all the real estate belonging to the testator, or in which the testator had any interest at the testator’s decease, unless a contrary intention appear by its words in context.
Tenn. Code Ann. § 32-3-101
There can also be contracts that affect interpretation of a will:
(a) A contract to make a will or devise, or not to revoke a will or devise, or to die intestate can be established only by:
(1) Provisions of a will stating material provisions of the contract;
(2) An express reference in a will to a contract and extrinsic evidence proving the terms of the contract; or
(3) A writing signed by the decedent evidencing the contract.
(b) The execution of a joint will or mutual wills does not create a presumption of a contract to make a will, or to refrain from revoking a will.
Tenn. Code Ann. § 32-3-107
And if the testator, or the testators attorney, was inartful, you can get a court to change the will for you.
To achieve the testator’s tax objectives, the court may modify the terms of a will in a manner that is not contrary to the testator’s probable intention. The court may provide that the modification has retroactive effect.
Tenn. Code Ann. § 32-3-114
Tennessee Courts interpret wills in much the way they interpret contracts.
All of the rules we have stated hereinabove [including the presumption] are subject to the cardinal rule that the intention of the testator must prevail, so far as it is possible to give it effect without contravening some fixed rule of law; but the testator’s intention must be ascertained from “that which he has written” in the will, and not from what he “may be supposed to have intended to do,” and extrinsic evidence of the condition, situation and surroundings of the testator himself may be considered only as aids in the interpretation of the language used by the testator, and “the testator’s intention must ultimately be determined from the language of the instrument weighed in the light of the testator’s surroundings, and no proof, however conclusive in its nature, can be admitted with a view of setting up an intention not justified by the language of the writing itself.” Sizer’s Pritchard on Wills (2d Ed.) §§ 384, 387, 388, and 409.
In re Walker, 849 S.W.2d 766, 768 (Tenn. 1993), Citing Nichols v. Todd, 20 Tenn.App. 564, 570–71, 101 S.W.2d 486, 490 (1936).
“In construing a will, the cardinal rule is that the Court must attempt to ascertain the intent of the Testator and to give effect to that intent unless prohibited by a rule of law or public policy.” In re Estate of McFarland, 167 S.W.3d 299, 302 (Tenn.2005). The Testator’s intentions are ascertained from the natural meaning of the language used in the will and the will’s context, scope, and purpose. Id. at 302; Daugherty v. Daugherty, 784 S.W.2d 650, 653 (Tenn.1990); Whitfield v. Butler, 30 Tenn.App. 221, 204 S.W.2d 537, 538 (Tenn.Ct.App.1947).
In re Estate of Snapp, 233 S.W.3d 288, 291 (Tenn. Ct. App. 2007)
- Using Disclaimers Correctly
Essentially, a disclaimer is a way to pass assets that the intended beneficiary does not want, or need, to beneficiaries downstream without gift tax consequences. The estate need not be taxable for a disclaimer to be useful. There are both Tennessee and federal statutes on disclaimers.
(a) A person who is:
(1) The donee of a gift, whether outright or in trust;
(2) A recipient of property from a decedent’s estate;
(3) A recipient of property on the exercise of a power of appointment;
(4) A recipient of property resulting from another person’s disclaimer;
(5) A recipient of property resulting from any other type of gratuitous transfer;
(6) A fiduciary holding powers as a fiduciary; or
(7) A beneficiary designated in a pay-on-death account, an insurance policy, an individual retirement account, an annuity, a retirement plan, whether qualified or not, or any other type of deferred compensation arrangement;
may disclaim all or part of the property, powers or interest in property as provided in this section. The disclaimer may be made by the person’s personal representative, trustee, guardian, conservator, attorney in fact or parent having custody if the disclaimant is a minor and no legal guardian has been appointed. If the disclaimer is made by a fiduciary, including, but not limited to, the enumerated positions in the preceding sentence, the disclaimer shall be binding on any successor fiduciary.
(b) To be effective the disclaimer must be an irrevocable and unqualified refusal by a person to accept an interest in property or to retain fiduciary powers but only if:
(1) The refusal is in writing, which writing shall:
(A) Describe the property or part of the property or interest in property or powers disclaimed;
(B) Be signed by the person disclaiming or that person’s representative; and
(C) Declare the disclaimer and the extent of the disclaimer.
(2)(A) Except as provided in subdivision (b)(2)(B), the writing is received by the transferor of the interest, the transferor’s legal representative, or the holder of the legal title to the property to which the interest relates, and, if the subject of the disclaimer is realty, is filed in the county register’s office and, if the disclaimer involves an interest in a decedent’s estate, with the court in which the decedent’s estate proceedings are or would be pending not later than the date which is nine (9) months after the later of:
(i) The date on which the transfer creating the interest or power in the person is made; or
(ii) The day on which the person attains twenty-one (21) years of age.
(B)(i) It is the intent of the general assembly that this subdivision (b)(2)(B) conform state law to extend the time period for certain disclaimers as authorized by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, Pub.L. 111-312.
(ii) In the case of the estate of a decedent dying after December 31, 2009, but before January 1, 2011, the writing is received by the transferor of the interest, the transferor’s legal representative, or the holder of the legal title to the property to which the interest relates, and, if the subject of the disclaimer is realty, is filed in the county register’s office and, if the disclaimer involves an interest in a decedent’s estate, with the court in which the decedent’s estate proceedings are or would be pending not later than the later of:
(a) September 17, 2011; or
(b) The date which is nine (9) months after the later of:
(1) The date on which the transfer creating the interest or power in the person is made; or
(2) The day on which the person attains twenty-one (21) years of age.
(3) The person has not accepted the interest or any of its benefits or exercised the power; and
(4) As a result of the refusal, the interest passes without any direction on the part of the person making the disclaimer and passes either:
(A) To the spouse of the transferor; or
(B) To a person other than the person making the disclaimer.
(c) Unless the decedent has otherwise indicated by will, the interest disclaimed passes to those persons including the ones who would take under § 32-3-105 as if the person disclaiming had predeceased the decedent. Unless the donor of a gift or the creator of a power has otherwise indicated in the document evidencing the gift or creating the power, the interest disclaimed passes as if the person disclaiming had died intestate, or, if the person disclaiming is one designated to take pursuant to a power of appointment, as if the person disclaiming had predeceased the donee of the power. In every case the disclaimer relates back for all purposes to the date of death of the decedent, the date of the gift or the date of death of the donee of a power, as the case may be. If the disclaimer is of a fiduciary power, the power will either be exercisable by some other fiduciary or void.
(1) Assignment, conveyance, encumbrance, pledge, or transfer of property or an interest therein or any contract therefor;
(2) Written waiver of the right to disclaim or any acceptance of property by an heir, devisee, donee, person succeeding to a disclaimed interest, beneficiary, or person designated to take pursuant to a power of appointment; or
(3) Sale or other disposition of property pursuant to judicial process; made before the expiration of the period in which the person is permitted to disclaim, bars the right to disclaim as to the property.
(e) The right to disclaim granted by this section exists irrespective of any limitation on the interest of the person disclaiming in the nature of a spendthrift provision or similar restriction.
(f) This section does not abridge the right of any person to assign, convey, release, or disclaim any property arising under any other section of this title or any other statute.
(g) Any interest in property that exists on April 1, 1977, at one minute past midnight (12:01 a.m.), but has not then become indefeasibly fixed both in quality and quantity, or the taker of which has not then become finally ascertained, may be disclaimed after one minute past midnight (12:01 a.m.) on April 1, 1977, as provided in this section. An interest that has arisen prior to one minute past midnight (12:01 a.m.) on April 1, 1977, in any person other than the person disclaiming is not destroyed or diminished by any action of the person disclaiming taken under this section.
Tenn. Code Ann. § 31-1-103
(a) General rule.–For purposes of this subtitle, if a person makes a qualified disclaimer with respect to any interest in property, this subtitle shall apply with respect to such interest as if the interest had never been transferred to such person.
(b) Qualified disclaimer defined.–For purposes of subsection (a), the term “qualified disclaimer” means an irrevocable and unqualified refusal by a person to accept an interest in property but only if–
(1) such refusal is in writing,
(2) such writing is received by the transferor of the interest, his legal representative, or the holder of the legal title to the property to which the interest relates not later than the date which is 9 months after the later of–
(A) the day on which the transfer creating the interest in such person is made, or
(B) the day on which such person attains age 21,
(3) such person has not accepted the interest or any of its benefits, and
(4) as a result of such refusal, the interest passes without any direction on the part of the person making the disclaimer and passes either–
(A) to the spouse of the decedent, or
(B) to a person other than the person making the disclaimer.
(c) Other rules.–For purposes of subsection (a)–
(1) Disclaimer of undivided portion of interest.–A disclaimer with respect to an undivided portion of an interest which meets the requirements of the preceding sentence shall be treated as a qualified disclaimer of such portion of the interest.
(2) Powers.–A power with respect to property shall be treated as an interest in such property.
(3) Certain transfers treated as disclaimers.–A written transfer of the transferor’s entire interest in the property–
(A) which meets requirements similar to the requirements of paragraphs (2) and (3) of subsection (b), and
(B) which is to a person or persons who would have received the property had the transferor made a qualified disclaimer (within the meaning of subsection (b)),
shall be treated as a qualified disclaimer.
26 U.S.C.A. § 2518
As should be abundantly clear from both statutes, watch your timing and make sure it is a signed and delivered writing with proof of delivery. A disclaimer is a useful post mortem estate planning tool in some circumstances. They are limited. A disclaimer is not a chance to rewrite a will. Whatever it is that is disclaimed cannot be directed. It must go as if the person making the disclaimer had predeceased. You also want to be very careful about passing on anything less than the entire thing disclaimed. There are abundant cases reported from the Tax Court where the tax benefits of the disclaimer were disallowed because the partial interest disclaimed was deemed something other than an undivided interest in the whole.