Q: Can a provision be made in a Revocable Trust for alternate beneficiaries after the sole original beneficiary dies?

A: Yes, in Colorado, provisions can be made in a revocable trust for alternate beneficiaries to inherit after the sole original beneficiary dies. This is standard practice, where alternate (or contingent) beneficiaries are named to receive trust assets, such as real estate, upon the death of the original or primary beneficiary.

Alternate Beneficiaries Receiving Residual Real Estate:

Colorado law allows for alternate beneficiaries to receive any remaining assets of a trust, including real estate, once the lifetime or primary beneficiary passes away. This is often referred to as a "remainder interest." If the real estate is the only remaining asset in the trust, it can be left to alternate beneficiaries, and the trust will remain open until the final distribution of that asset.

Informing Alternate Beneficiaries:

There is no legal requirement in Colorado that alternate beneficiaries be informed when the trustor (settlor) dies, especially if their interest does not come into effect until the death of the original beneficiary. This avoids creating undue risk to the primary beneficiary, as they have the right to benefit from the trust during their lifetime, and alternate beneficiaries have no claim until after the original beneficiary's death. However, once the original beneficiary dies, the alternate beneficiaries should be notified, as they would then have rights to the trust assets.

Avoiding Risk to the Primary Beneficiary:

To protect the primary beneficiary from potential risks like foul play, it’s common practice to structure the trust so that alternate beneficiaries are not informed of their contingent inheritance until necessary. The trustee has a fiduciary duty to administer the trust in the best interest of the beneficiaries and would typically manage communications accordingly.