Each year the local media reports dozens of cases involving disputes between beneficiaries and estate administrators over access to a California inheritance. Based on the commonality of heirs struggling to prove that they are entitled to all or part of an estate, it is hard to imagine a situation that would involve a bequest being refused. In reality, there is a possibility that your chosen beneficiary may refuse to accept all or part of his or her own inheritance. Learning a few of the most common reasons that influence an heir to refuse their inheritance can help you prepare an estate plan that covers all eventualities.
There are times when an asset, real estate, in particular, is undesirable and viewed as more trouble than it will be worth. After watching the previous owner work unsuccessfully to sell the property or finding out that maintaining a property costs more than the actual real value, an heir might refuse that part of the inheritance. If a property has the potential to be problematic, including funds for repairs, taxes, etc. in your bequest may help negate some of the possible downsides. Otherwise, your beneficiaries may refuse the property leading to the state becoming its owner.
A person who is in bankruptcy or preparing to file bankruptcy must disclose inherited related assets. If you have named a beneficiary as heir to money or property and that beneficiary is bankrupt, his or her inheritance might become part of the bankruptcy estate. When the property being received is not worth the amount needed to pay off debts or could cause Chapter 13 bankruptcy payments to increase, an heir might refuse the bequest. There are certain exemptions that could protect the petitioner, allowing them to inherit the property without losing it to creditors or having Chapter 13 payments increase but your heir might be forced to refuse their inheritance.
A person who is disabled and receiving forms of government assistance such as Medi-Cal, Veterans Affairs Aid, and Attendance, and Supplemental Security Income (SSI) can only retain benefits if they have limited cash assets. Accepting an inheritance could lead to your heir losing assistance until the money is spent. Beneficiaries who receive government assistance are also placed in the difficult position of not always being able to refuse bequests. In some cases, Medi-Cal has told recipients that they do not have the right to refuse any bequest. The way the inheritance is distributed can often affect how government benefit recipients are impacted.
Talk to an Attorney About Your Concerns
If you or someone close to you is worried about heirs being forced to refuse a bequest, consider talking to a trust and estate lawyer about your concerns. A lawyer who has successfully helped establish a variety of special needs trusts, conservatorships, and more is able to assist you with coming up with an estate plan that addresses the possibility of bequest refusal. MMZ Law realizes how important it is for you to leave your heirs assets without causing them any additional distress. Contact our conveniently located Claremont, California office today at 909-256-6702 to schedule a consultation.
*We service Elder Law through Medi-Cal Asset Protection Planning
BROUGHT TO YOU BY:
MMZ LAW, A PROFESSIONAL CORPORATION
341 W. 1st St. Suite 100
Claremont, CA 91711
MARIVEL M. ZIALCITA is the founder of MMZ LAW, A Professional Corporation, where she practices in the areas of Elder Law – Medi-Cal Planning Asset Protection, Trust & Estate, Special Needs, Conservatorship, Trust Administration, & Probate. Ms. Zialcita is a frequent speaker on trust and estate matters and holds memberships in the State Bar of California, Trust and Estate Section, The San Bernardino County Bar Association, Wealth Counsel and Elder Counsel. She currently assists in the pro bono legal services program at the James L. Brulte Senior Center in Rancho Cucamonga, California. She is based in Claremont but assists clients throughout Southern California.
This information is educational information only and not legal advice.