Protracted probate court battles do not only result from multi million-dollar estates. Smaller estates, even those with carefully laid estate plans in place, could end up subject to contentious and expensive probate proceedings as the result of dissatisfaction on the part of heirs or beneficiaries.
Many different factors can contribute to whether an heir decides to contest a last will or estate plan. Common issues include one heir receiving a larger portion of the estate than others or the remarriage of the deceased leading to a second spouse receiving a significant portion of that person’s assets.
Thankfully, there are steps that a person planning their estate can take to reduce the risk of challenges and probate court. One of them is the popular no-contest clause, also called an “in terrorem” clause. Including one of these in your estate plan can reduce the risk of someone challenging your estate and squandering assets on an unnecessary trip through probate court.
Why do people bring a challenge against a sound estate plan?
Making a thorough estate plan is a complicated process that people approach in different manners. It is common for differing family situations to result in drastically different approaches to dividing assets between family members and heirs.
While many people do their best to split assets fairly and evenly between their children, grandchildren and other beneficiaries, some people have reason to create an unbalanced structure to their estate plan. Addiction, estrangement, poor money management skills and even disparate earning potential can all have an impact on how someone structures their last will.
Unfortunately, the more imbalanced an estate plan, the more likely family members may be to take issue with it. Similarly, remarriages can often result in children contesting the share of assets allocated to a second spouse. The end result can be the courts overturning your wishes in favor of the demands of your family members.
A significant portion of the assets you leave behind can also end up diminished by the requirement to pay for probate court. While that may bother you, the people bringing the challenge against your will may feel like the larger inheritance is worth the risk of wasting estate assets on probate costs. Including a no-contest clause removes the financial incentive to challenge a last will.
The potential benefits of a no-contest clause in your will
While you don’t have any control over what family members do after you die, you should have control over planning your own legacy. Adding a no-contest clause effectively strips the financial motivation for challenging your legacy as you planned it.
Instead of potentially receiving a larger portion of the estate, those who challenged and estate plan with a no-contest clause will find themselves facing a future in which they inherit nothing. In most cases, Georgia courts will uphold no-contest clauses in estate plans, trusts and last wills.
Make sure that your family knows that you included a no-contest clause in your last will. That way, even if they feel disappointed about what you allocated to them in your will, they will be grateful to receive anything. In most cases, heirs will not risk losing their whole inheritance for the potential of increasing it slightly.