[WSBAPT] Disclaimers after 9 Months?

[Paul Neumiller]

Thanks to all who responded.  I knew of RCW 11.86.031, I was just hoping someone knew of a clever work-around. But, alas, there does not appear to be one.


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From: wsbapt-bounces at lists.wsbarppt.com On Behalf Of Karin Treadwell
Sent: Saturday, February 8, 2025 3:29 PM
To: WSBA Probate & Trust Listserv
Subject: Re: [WSBAPT] Disclaimers after 9 Months?

Paul:

The surviving spouse has missed the nine-month disclaimer deadline, but depending on the client’s goals, there are some alternate strategies available.

If the purpose of the disclaimer would have been to make use of the first spouse’s estate tax exemption amounts, then there is a workaround at the federal level-- the surviving spouse could file a federal estate tax return to elect portability – to port over the first spouse’s unused federal estate tax exemption amount to apply on the surviving spouse’s second death to shelter the surviving spouse’s estate from federal estate tax.  The IRS in 2022 extended the time for a surviving spouse to file a 706 to elect portability to five years, so this might well work in your client’s situation as an alternative to disclaimer.

Washington has no equivalent portability concept, which is why funding a credit trust via disclaimer is often key in making use of the first spouse’s $2.193 million Washington estate tax exemption amount.  If the surviving spouse can no longer disclaim to fund the credit trust, at least the marital deduction would mean no estate tax due on assets passing to the surviving spouse (though a Washington estate tax return may have been required).  The surviving spouse could then look to other lifetime estate tax planning techniques to target the possible Washington estate tax exposure.

Karin
Karin S. Treadwell
Sayre Law Offices, PLLC
1417 31st Ave S
Seattle WA  98144-3909

phone 206-625-0092
fax 206-625-9040

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Paul Neumiller
Sent: Friday, February 7, 2025 4:19 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: [WSBAPT] Disclaimers after 9 Months?

Client’s deceased spouse had a disclaimer trust in Will.  Surviving spouse DID NOT disclaimer for at least two years.  Now, client’s CPA says there is no work-around on the federal level to make a valid disclaimer but asks if there is a work-around at the state level.  I’m not aware of any (and way outta my wheelhouse) but I said I’d ask this group of esteemed attorneys.  Is there a work-around for a late disclaimer or is the client dead in the water?


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