Many tax and estate planing professionals are aware of the basic tax rules governing dedications for charitable contributions. They know the general distinctions between the limits on income tax deductions for contributions to private foundations, and for contributions to public charities.
The disclaimer can be a helpful tax and estate planning tool if used correctly. Often, the disclaimer is employed as a postmortem remedial device to fend off adverse tax repercussions and other unintended consequences of an estate plan gone awry. Other times, the anticipated use of the disclaimer is consciously incorporated into the estate plan by its drafter to preserve tax and distributive flexibility at the decedent’s death. Although, this article focuses on the application of the disclaimer in the estate tax context, significant non-tax objectives may also justify its use.