On July 1, 2009 the State of Colorado Designated Beneficiary law went into effect. This new law authorizes any Colorado resident to sign a Designated Beneficiary Form providing an array of legal and property rights to the other person who is party to the form.
Without understanding the law in Colorado and how this form will effect estate, legal and property rights, we recommend that no one consider signing a Designated Beneficiary Form without legal advice in advance.
The Colorado Designated Beneficiary law is Colorado's attempt to recognize domestic partnerships. However, the form authorized by this new law does something quite different. The form attempts to undo established Colorado law and property rights without clarifying how these changes work.
For example, the form permits the designated beneficiary to inherit through Colorado's law of intestacy. However, the new law does not designate in which position the designated beneficiary would be placed. Would they be in front of a spouse? In front of a child? This is not defined.
Additionally, the new law was completely unnecessary. Each of the rights that can be granted to a designated beneficiary were previously available to be provided to a domestic partner through appropriate estate planning documents such as a Will or Durable Power of Attorney. The new form even says that the form itself is superseded by ANY estate planning document created by its user.
There are other reasons to numerous to mention here about how fatally flawed the Colorado Designated Beneficiary law is. Suffice it to say, that anyone using this new form without legal advice will be subject to serious legal risk.
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