We live in Minnesota; I think my wife and I should make some changes in our IRA beneficiaries for estate tax purposes, state not federal, as it seems we will have no problem there. Currently we are both each other’s primary beneficiaries, naming our offspring as secondary beneficiaries.

What we discussed was that when one of us passes away; the surviving spouse would evaluate their finances at that time and disclaim an amount to get somewhat below the $1M MN threshold for estate taxes. However, I doubt that that would fly, it seems like the state would want to count that as a gift by the surviving spouse. So, it seems that we both need to change beneficiaries on some accounts, making our offspring the primary beneficiaries and their children the secondary beneficiaries. Is this a valid strategy or any other suggestions?