The Mississippi Uniform Disclaimer of Property Interests Act (2002/2010) (the “Mississippi Disclaimer Act”), which replaces the Uniform Disclaimer of Property Interests Act (the “Old Disclaimer Act”), became effective July 1, 2020. See Miss. Code Ann. 89-22-1 et seq. The National Council of Commissioners on Uniform State Laws (NCCUSL) first adopted the Uniform Disclaimer of Property Interests Act in 1999. It was last updated in 2010.
Many of the duplicative and logistically challenging technical requirements applicable under the Old Disclaimer Act have been eliminated in the Mississippi Disclaimer Act. For example, when disclaiming property passing by will or intestacy in an estate subject to administration, the Mississippi Disclaimer Act permits delivery of the disclaimer to the executor to suffice. It is no longer necessary to also file a disclaimer in the probate proceeding.
The Mississippi Disclaimer Act also includes provisions that are specifically designed to address the unique characteristics of different types of property and ownership structures. For example, there are specific provisions regarding survivorship property and beneficiary designation property which are missing in the Old Disclaimer Act.
Let’s take a closer look.
There is no deadline, so long as the disclaimer is made before accepting the property.
Prior to 1977, federal tax law did not have a hard‐and‐fast nine‐month deadline for qualified disclaimers. Like most states, Mississippi reacted to the 1977 tax legislation by adopting a nine‐month deadline in its statute. However, there is no reason why disclaimers under state law need to be tied to that deadline.
One of the major changes of the Mississippi Disclaimer Act is abandonment of the nine‐ month deadline for disclaimers. A disclaimer still may have to be made within nine months of the decedent’s death to be a qualified disclaimer for tax purposes, but a disclaimer can be effective for state law purposes even if it is made more than nine months after the decedent’s death.
What sets the state law deadline for a disclaimer under the new statute? Acceptance. A disclaimer is barred if the disclaimant “accepts” the interest sought to be disclaimed. Miss. Code Ann. § 89-22-27(b)(1). It should be noted, however, that acceptance of property in a fiduciary capacity is not an acceptance of the property in an individual capacity and does not bar a disclaimer in an individual capacity. Miss. Code Ann. § 89-22-27.
What must the disclaimer instrument contain?
To be effective, a disclaimer must be in writing, declare the disclaimer, describe the interest or power disclaimed, be signed by the person making the disclaimer, and be delivered or filed in the manner provided in Miss. Code Ann. § 89–22–25. See Miss. Code Ann. § 89-22-9(d). If the person is disclaiming a partial interest, he or she may express that interest as a fraction, percentage, monetary amount, term of years, limitation of a power, or any other interest or estate in the property. Miss. Code Ann. § 89-22-9(e).
What about delivering or filing it?
If there is a personal representative of the estate, the disclaimer must be delivered to the personal representative, and it does not have to be filed or recorded anywhere. Miss. Code Ann. § 89-22-35(c)(1). It may be delivered by personal delivery, first‐class mail, facsimile, e‐mail, or “any other method likely to result in the disclaimer’s receipt.” Miss. Code Ann. § 89-22-35(b). If there is no personal representative of the estate, the disclaimer must be filed with a court having jurisdiction to appoint the personal representative. Miss. Code Ann. § 89-22-35(c)(2).
To whom does the disclaimed property go?
If the will or other instrument creating the interest says where it goes in the event of a disclaimer, the interest goes where the instrument says it goes. Miss. Code Ann. § 89-22-11(b)(2). If the instrument does not say where the disclaimed property goes, then it passes as if the disclaimant did not exist (in the case of an entity) or had died immediately before the decedent’s death (in the case of an individual). Miss. Code Ann. § 89-22-11(b)(3).
When is the disclaimer effective?
Except for disclaimer of property held as joint tenants, tenants by the entirety, or by a trustee, the disclaimer takes effect as of the time the instrument creating the interest becomes irrevocable, or, if the interest arose under the law of intestate succession, as of the time of the intestate’s death. Miss. Code Ann. § 89-22-11(b). While it isn’t expressly stated in the Mississippi Disclaimer Act (except with respect to trustees), a disclaimed interest is not subject to the claims of any creditor of the disclaimant. The disclaimer by a surviving joint tenant takes effect as of the death of the holder of jointly held property to whose death the disclaimer relates and passes as part of the estate of the deceased holder. Miss. Code Ann. § 89-22-13. The disclaimer by a surviving spouse of the deceased tenant’s interest in property held by tenants by the entirety takes effect as of the death of the deceased tenant to whose death the disclaimer relates and the interest passes as if the disclaimant had predeceased the tenant to whose death the disclaimer relates. Miss. Code Ann. § 89-22-15. The disclaimer by a trustee of an interest in property that otherwise would have become trust property takes effect as of the time the trust became irrevocable and relates back for all purposes to the time the trust became irrevocable. Miss. Code Ann. § 89-22-17.
There is a lot to the Mississippi Disclaimer Act. If you want to learn more, add Miss. Code Ann. § 89-22-1 et seq. to your reading list and check out SB 2851.