Skip to Content

We are a Veteran Owned Business, providing 20% discounts for Veterans, First Responders, Elementary and High School teachers. Please contact us to set up a phone or Zoom meeting. Taking care of you and your family, It's What We Do!

Klenk Law

Using Disclaimer to Avoid Creditors in New Jersey – Not a Good Idea

Posted on Wed Jan 14, 2015, on Estate Planning

From our “Ask a Question” Mailbag: Using Disclaimer to Avoid Creditors in New Jersey – Not a Good Idea

Most Recently Updated July 8, 2018.

“My father, a Burlington County, New Jersey, resident, is planning to leave me an inheritance in his Will. I have substantial creditor problems. If my father dies, can I disclaim my inheritance so it passes to my children?”

Life-Insurance-Is-A-Non-Probate-Asset

Using Disclaimer to Avoid Creditors in New Jersey – Not a Good Idea

Using Disclaimer to Avoid Creditors in New Jersey – Not a Good Idea

In New Jersey, a disclaimer is an heir’s legal refusal to accept a gift or a bequest. In other words, you can’t force someone to accept a gift. If a Will names someone an heir or if a life insurance policy names a beneficiary, that heir or beneficiary cannot be “forced” to accept the gift. If the heir or beneficiary legally and properly refuses the gift, it is called a “disclaimer.”

But, an heir or beneficiary cannot use a disclaimer to avoid existing creditors. We would have to discuss your exact circumstances, but it sounds as if your creditors would be able to properly claim that your disclaimer was fraud under the Uniform Fraudulent Transfer Act.

Other Available Options

That being said, your father does have other options to shelter the gift. New Jersey allows him to set up a protective trust where the assets are held for your benefit, but are not available to your creditors. He could also name your children as the beneficiaries of the estate, so your creditors would have no claims. These decisions are up to your father, but if he consults with an experienced Burlington County Estate Planning Attorney, he will find that he has many options available to benefit his child or grandchildren and avoid the gift from passing to your creditors.

More Planning Questions?

Proper planning is only a piece of the Estate Planning process. By all means, if you want to learn more, please read my more detailed article, Estate Planning Everything You Need to Know.

In Conclusion: Using Disclaimer to Avoid Creditors in New Jersey – Not a Good Idea

I hope that this article was helpful in explaining proper planning for creditor problems. Further, I included links to even more detailed information on my website so you can learn more. Therefore, please contact me and let me know how I did. Certainly, your comments and questions are welcome!

Let our Estate Planning lawyers help walk you through what can be a confusing process. To begin with, call to speak to one of our experienced estate planning lawyers.  By all means, our lawyers are ready to answer your questions. In fact, feel free to contact our office for a free consultation. Ultimately our goal is to make the process as painless as possible!

Wills, Trusts, Probate, and Estate Litigation, It’s All We Do!

 

Tags:

Avoiding Probate, Burlington County, creditor claims, Estate Planning, Estate Planning Attorney, Estate Planning Lawyer, New Jersey, Trusts

What Our clients are saying

Klenk Law Logo
Stars

Peter Klenk & Associates is my go-to firm for estate planning and advice in probate and estate administration. Peter and his attorneys are top-notch and exceptionally responsive. Peter has the knack of being able to explain extremely complex tax and estate planning issues in a manner that clients are easily able to understand and comprehend allowing them to confidently make important decisions.

Klenk Law Logo
Stars

Professional, cheerful, thorough and fast. Peter responded to my request for a consultation right away, and within just a few days my last will and living will were done. Rates are standard.

Klenk Law Logo
Stars

We recently used Peter's firm to update our wills and trusts. We found he and his staff to be well-informed, professional and highly efficient. And equally valuable, Peter explains the law in terms that a layperson can readily understand.

Klenk Law Logo
Stars

I met Peter soon after he started his practice in Philadelphia, PA. He and his team have always been there for me and my various inquiries throughout my life-changing events, corporate relocations. I have lived in various cities throughout the nation, I have never had a problem in contacting Peter or a member of his team. He and his office responds quickly and returns calls to me to fulfill my requests for information or to revise my estate needs while posing relevant thought-provoking questions that I need to consider to secure my future. One of Peter's best qualities is his ability to answer clients complicated questions in a simple way to ensure comprehension.

Klenk Law Logo
Stars

Klenk Law is an exceptional practice. Their fine lawyers and staff team up to produce excellent results for their clients. They excel at explaining the often cryptic laws and policies that govern estate planning right down to the complexities of the various "trust" frameworks. Peter himself manages each client together with his great team, and he has a rare quality to be both a walking encyclopedia of planning minutia and also one of the most likable lawyers I have ever had the pleasure of dealing with. He is truly generous in intellect and in his personal approach to getting the "big picture" for complex family structures. I trust him implicitly to help me make the right choices for the future. In short, Klenk Law is a gem of a firm.

Let us put our expertise to work for you.

Free consultation within 24 hours.