Florida enacted the Florida Uniform Disclaimer of Property Interests Act (the “FUDPIA”) in an effort to allow potential heirs and beneficiaries of an estate to opt-out of an inheritance. The Florida Legislature codified FUDPIA in Florida Statutes, Chapter 739. FUDPIA defines a disclaimer as a “refusal to accept an interest in or power over property. The term includes a renunciation.” A disclaimer in the context of FUDPIA is when an heir or beneficiaries of an estate or trust refuses to accept their inheritance. Under the Florida Uniform Disclaimer of Property Interests Act, a person may disclaim a whole or partial interest in property.
Florida Statutes 734.104(1) provides the right to disclaim an interest in real property:
A person may disclaim, in whole or in part, conditionally or unconditionally, any interest in or power over property, including a power of appointment. A person may disclaim the interest or power even if its creator imposed a spendthrift provision or similar restriction on transfer or a restriction or limitation on the right to disclaim. A disclaimer shall be unconditional unless the disclaimant explicitly provides otherwise in the disclaimer.
Why Would Somebody Disclaim Their Inheritance?
You might disclaim an interest in inheritance for a number of reasons. An individual who is independently wealthy may not need or want an inheritance. Interpersonal dynamics between an heir or beneficiary and the deceased might be such that the heir or beneficiary does not want to accept anything from the deceased. Still, others might have reasons to keep their assets low, i.e., Medicare and Medicaid planning.
Mechanism for Disclaimer
Florida Statutes 734.104(3) requires that a disclaimer include all of the following
- Be in writing
- Declare the writing as a disclaimer
- Describe the interest or power disclaimed
- Be signed by the person making the disclaimer and witnessed and acknowledged in the same manner as a deed for real property recorded in Florida.
- The original disclaimer must be delivered or filed in the manner provided for under the Florida Uniform Disclaimer of Property Interests Act, Section 301
- Florida Uniform Disclaimer of Property Interests Act, Section 601 also provides additional requirements if the disclaimer is to be recorded
In Lee v. Lee, 263 So.3d 826 (Fla. 3rd DCA 2019), the appellate court reversed a lower court decision that found a legal disclaimer to be legally insufficient. The disclaimer that complied with Florida Statutes 734.104(3), but not 734.601 because the recorded disclaimer did not contain the legal description of the property. Recording the legal description acts to provide constructive notice to anyone conducting a title search involving real property. The court held that “[w]hile the absence of a legal description of the subject property renders the disclaimer incapable of recordation under section 739.601, the lack of a legal description does not otherwise affect its validity.” Therefore, the issue became one of notice rather than the validity of the disclaimer itself.
Having a legal disclaimer is not just academic. There are a number of valid reasons why somebody might dislciam legal property. For instance, if a person inherited a home with mortgages in excess of the value of the property, that person might not want to deal with the consequences of those mortgages and instead would prefer to disclaim their interest in the property. In other cases, a recipient might worry about losing qualifications for medicade and view the government benefits as more attractive than the property interest.
It is important to discuss the specifics of your case with a Florida Attorney. Nothing in this post constitues a legal advise or the formation of a legal relationship.
Florida Trusts and Estates Attorneys Matthew D. Weidner and Jason M. Kral have helped have utilized decades of combined litigation experience to help many clients resolve difficult issues relating to probate and estate settlement throughout the state of Florida including Tampa, St. Petersburg, and Orlando. If you or someone you know has any questions regarding these matters, please contact us at (727) 954-8752 for a free initial consultation.