What could happen to a beneficiary who violates a "no contest" clause?

When a beneficiary violates a "no contest" clause, they typically face the consequence of losing their inheritance entirely. A "no contest" clause is designed to discourage beneficiaries from challenging the validity of a will or trust by imposing significant penalties for such actions; the intention behind this clause is to preserve the testator's or settlor's wishes without interference or disputes.

In essence, if a beneficiary goes against the stipulations of a "no contest" provision by, for example, filing a lawsuit challenging the trust or will, they can forfeit their rights to any inheritance they would have received. This serves as a strong deterrent, encouraging beneficiaries to respect the terms set forth in the will or trust and to avoid frivolous claims that could disrupt the administration of the estate or trust.

The other options do not align with the typical consequences prescribed by a "no contest" clause. Beneficiaries do not get rewarded beyond their original inheritance, nor can they initiate new claims against the trust without risking their inheritance. While returning an inheritance after a case review might seem plausible, it does not capture the essence of the immediate and total loss that the clause can impose upon non-compliant beneficiaries.