Our sister publication (and website) — Trusts & Estates — blasted its twice monthly Wealth Watch newsletter today. I share it with you because, well, the headline grabbed me and this never occured to me: “Sometimes, objectives can be better achieved by disclaiming instead of accepting a bequest,” writes Conrad Teitell, chairman of the National Charitable Planning Group, Cummings & Lockwood, a prestigious law firm in Stamford, Conn. He recounts this story: Some time ago my neighbor, a Wall Street lawyer, headed a citizens’ committee that succeeded in shutting down a brothel — the only one in our town since its founding in 1640. A few years later, the madam died and left her entire $2 million estate to my neighbor “in gratitude for the many enjoyable nights that we spent together.” Teitell continues: His client said, “This is terribly embarrassing; what should I do?”, my neighbor asked. I advised him to renounce — disclaim — the bequest. “
The story is amusing and very instuctive. Every wealth manager might want to be aware of this legal tax-avoidance strategy.
(Read more from Editor-in-Chief, David A. Geracioti on his blog, Von Aldo.)