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Can you refuse an inheritance???

I have an interesting and true dilemma and I'd like to seek opinions from all of you. No we have not spoken to lawyers yet.
My father-in-law possibly has an estate worth 1.5 to 2 million dollars. He is currently 65 years of age but we have every reason to believe he will preserve his principal of 1.5 million and live off of a generous pension and investment income for the next few decades. Current thinking is my wife and her sister are to be sole beneficiaries of a cottage worth say $600 000.
My wife's sister is schizophrenic and is unable to work or support herself without social assistance. She is unable to live by herself and would be incapable of maintaining a cottage. My wife earns $100 000 a year, is very mentally stable and is married to me, and I'm in m.i.fin-plan so I hope it's established that I'm fiscally responsibly and of sound mind.
We believe my wife's father is structuring his will to have his cottage left to both my wife and her sister equally, and that a large amount of estate money perhaps all will be legally binded to ensure the upkeep of the cottage. We believe he would also find a way to PREVENT the sale of this cottage forcing his beneficariesto keep this cottage.
To put this in context, my wife's father wants his legacy tied up in his cottage and will be prepared to tie up all his money into upkeep of this cottage. My wife and I DO NOT want any part of this. We are unwilling to share ownership with a mentally ill co-owner and will not make any effort to visit this cottage or pay for it's upkeep. My wife and I are prepared to walk away from $750 000 or possibly more based on principal.
And if people must know my wife's father is very abusive and very creepy. He is a sex addict and a destroyer of families. He will never be allowed around our children. He is also a criminal court judge and used to own a former law practice so he knows law and knows plenty of people who know law.
So with all this in mind, is it possible to refuse this inheritance. Yes, it's true, I'm seeking advice from strangers on the possibility of walking away from 3/4 of a million dollars.
Reply to
The Henchman
Your wife can "disclaim" an inheritance or any portion of one. If she does, the terms of your FIL's will or trust will determine what happens to your portion. If the will states that the estate is split between your wife and her sister "per stirpes," then the portion you disclaim will flow to your heirs, putting them in the spot that you yourselves want to avoid (unless they also disclaim). If the will states "equal shares per capita to my children who survive me," and your wife disclaims, then it is as if she do not survive, and your sister in law will get the entire estate. This is not something you have to take care of right away. After your FIL dies and the terms of his will are known, your attorney can help you take the correct action before the estate is probated.
Dave
Reply to
Dave Dodson
Andy comments:
Another approach is to accept the inheritance, and then quit-claim the total to your sister. This would, however have gift tax implications regarding your estate to your own heirs. You are not required to "accept" a gift or inheritance from anyone. Possibly you could quit-claim the inheritance to a charity without tax implications. A little advice from a tax lawyer might go a long way if you elect to take a route like this.
Andy in Eureka, Texas
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Reply to
AndyS
Tough one. Do you any access to the trust documents? Do you know who the trustee is? I don't recall the exact wording but there are provisions to break trust terms when they are, in effect, a white elephant. It seems the cottage benefits no one, and the sister isn't going to challenge your desire to split all the inheritance, selling that cottage.
It would be money well spent to sit with a trust attorney to discuss this.
Reply to
JoeTaxpayer
Maybe google on the phrase "qualified disclaimer" prior to a meeting with an attorney. This is the route for situations like yours that occur in the U.S. Also, I hear you about the poor relations with this person. Still, it might be worth a try explaining to him that, if he does what you think he will, you intend to seek a qualified disclaimer. This could save all some time and trouble.
Reply to
Elle

Maybe google on the phrase "qualified disclaimer" prior to a meeting with an attorney. This is the route for situations like yours that occur in the U.S. Also, I hear you about the poor relations with this person. Still, it might be worth a try explaining to him that, if he does what you think he will, you intend to seek a qualified disclaimer. This could save all some time and trouble.
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There may be an occasion in the future where he will be reasonable enuf to speak on these matters, however we have information to believe he is writing this will at this time. He has several lawsuits against him and his current wife of 12 years is "upset" at things to put it mildly so he is not in a reasonable condition to speak too.
However you are correct: People change and maybe in 5 years, my wife can speak to him on this matter and he can act rationally.
My wife is googling "qualified disclaimer" as we speak.
Reply to
The Henchman
Andy comments:
Another approach is to accept the inheritance, and then quit-claim the total to your sister. This would, however have gift tax implications regarding your estate to your own heirs. You are not required to "accept" a gift or inheritance from anyone. Possibly you could quit-claim the inheritance to a charity without tax implications. A little advice from a tax lawyer might go a long way if you elect to take a route like this.
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When my father-in-law divorced my mother-in-law they put a quit claim against each other so that she got the house and he got the cottage. Thanks for the tip
Reply to
The Henchman
 We believe he would also find a way to PREVENT the sale of this
Everybody wants to control inheritances from the graves, but it is not so easy. Before throwing away your share of the cottage, I'd talk to a lawyer about a "partition sale".
Reply to
Cam

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