The process of handling a deceased person’s assets is often complicated. A situation that may add to the complexity is when a beneficiary refuses to accept the assets they are due to inherit.
What happens to assets in Arkansas if a beneficiary chooses to reject them?
The act of refusing an inheritance
When a beneficiary refuses to accept an inheritance, this action is legally known as a disclaimer. To disclaim an inheritance in Arkansas, the beneficiary must submit a written document declaring their intention. The disclaimer must occur within nine months of the decedent’s death.
Distribution to the next in line
When a beneficiary disclaims an inheritance, they cannot direct where the assets go. According to Arkansas law, if a beneficiary refuses to accept an inheritance, the estate will distribute as though that beneficiary died before the individual who passed away.
Impact on the spouse and children
If the disclaiming beneficiary is a surviving spouse, the assets typically pass to the decedent’s children. If there are no children, the assets would go to the decedent’s next closest relatives according to the state’s laws of intestate succession.
Influence on joint assets
Joint assets with the right of survivorship, like some bank accounts and real estate, can complicate matters. If one joint owner disclaims the inheritance, the assets usually pass to the remaining joint owners.
Effect on the estate
An important point to remember is that a disclaimed inheritance may still impact the estate’s value for tax purposes. The Internal Revenue Service often still considers disclaimed inheritances part of the estate.
Refusing an inheritance in Arkansas can have significant effects on the distribution of an estate. The disclaimed assets do not evaporate but rather follow the state’s laws for distribution.