Probate & Trust Law Section Conference Manual ... - Minnesota CLE

epresentative.The writing should indicate that the disclaimant’s refusal to accept an interest in
property is both unqualified and irrevocable.
B. The Nine Month Test
Code § 2518(b)(2) requires that the writing be 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 not later than the date which is 9 months after the later of: (a) the day on which
the transfer creating the interest in the disclaimant is made, or (b) the day on which the
disclaimantattains age 21.The 9-month period for making a disclaimer is generally to be
determined with reference to the transfer creating the interest in the disclaimant. Reg. § 25.2518-
2(c)(3)(i).With respect to inter vivos transfers, a transfer creating an interest occurs when there is
a completed gift for Federal gift tax purposes, regardless of whether a gift tax is imposed on the
completed gift. Id.With respect to transfers made by a decedent at death or transfers that become
irrevocable at death, the transfer creating the interest occurs on the date of the decedent's death,
even if an estate tax is not imposed on the transfer. Id.
The general rules for determining when there is a transfer commencing the 9 month disclaimer
period do not apply to the disclaimer of joint interests. There are two sets of special rules
applicable to disclaimers of joint property interests – one set of rules applies to joint bank and
investment accounts and the other applies to all other jointly-held property interests. The rule for
joint bank, brokerage and other investment accounts is thatif the transferor could unilaterally
regain the transferor's own contributions to the account without the consent of the other cotenant,
such that the transfer is not a completed gift under Reg. § 25.2511-1(h)(4), the transfer creating
the survivor's interest in the decedent's share of the account occurs on the death of the deceased
cotenant. Reg. § 25.2518-2(c)(4)(iii). The rule for all other types of jointly-held property interests
is that a qualified disclaimer of the interest to which the disclaimant succeeds upon creation of
the tenancy must be made no later than 9 months after the creation of the tenancy regardless of
whether such interest could be unilaterally severed under local law. Reg. § 25.2518-2(c)(4)(i). A
qualified disclaimer of the survivorship interest to which the survivor succeeds by operation of
law upon the death of the first joint tenant to die must be made no later than 9 months after the
death of the first joint tenant to die regardless of whether such interest could be unilaterally
severed under local law. Id.
Notwithstanding the foregoing rules, a beneficiary who is under 21 years of age has until 9
months after his twenty-first birthday in which to make a qualified disclaimer of his interest in
property. Reg. § 25.2518-2(d)(3.)
C. The No Acceptance Test.
Under Code § 2518(b)(3) a disclaimer will be qualified only if the disclaimant has not previously
accepted the disclaimed interest or any of its benefits.This requirement is obviously in keeping
with common law notions of gifts which hold that a gift is completed upon acceptance by the
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