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What is a no-contest clause?

On Behalf of | Mar 7, 2022 | Estate Planning

When you create an estate plan, there is the chance that one of your heirs will contest that plan. This often happens when one heir doesn’t feel that the plan is fair to them – such as if they’ve been disinherited.

Many people want to avoid these sorts of contests, which can be costly and which can put family members in court against one another. One way to do this is to use a no-contest clause in your estate plan. What does this clause do?

There’s a penalty for contesting the will

Essentially, a no-contest clause just means that anyone who decides to contest the will loses whatever they were given in that will.

For instance, perhaps you left one child $100,000 and the other child $10,000. If the child who got less contests the will, claiming that they should get more money, they will lose even the $10,000 that you initially assigned to them. This basically forces them to accept the decision because they would be better off to get $10,000, even if they don’t feel that’s fair than to challenge the will and lose everything.

You also need to be aware that there are situations in which these can be deemed not enforceable by the court. For instance, if it’s shown that the will actually is a forgery, then the no-contest clause likely will not hold up. So even this clause will not absolutely prevent all disputes in all cases, but it can lower the odds, especially if you know that your entire estate plan has been properly constructed. Make sure you know exactly what legal steps to take.