When you hear about mistakes that others make that yield negative consequences in the real world, it can really get your attention and impact your own actions. Yes, people can give you advice, but witnessing examples of what can actually happen can be a wake-up call.
This definitely enters the picture when it comes to estate planning. Attorneys will emphasize the importance, but at the end of the day, the majority of people go through life without any estate planning documents at all. Both younger folks and older individuals have failed to plan ahead appropriately.
You rarely hear about errors that are made by ordinary people, but some celebrity estate planning cases become widely publicized. Did you ever wonder why this information becomes available?
The probate court supervises the administration of an estate when a will is used, or when someone dies without a will. These records are available to the general public, and this is why you read about the details.
If you value your privacy you may want to arrange for asset transfers outside of probate through the utilization of a living trust if you value your privacy. Assets in a living trust can be distributed without probate involvement. This is a subject for another post, but it is related to the Aretha Franklin estate case that we will examine here.
The great soul singer Aretha Franklin died in August of 2018, and she was unmarried when she passed away. She is survived by four adult sons. Clearly, her estate is very valuable, and there will always be additional royalty revenues coming in that are generated by her work.
It has been reported that she had an attorney that had been working with her for over 40 years, but for whatever reason, at the time of her death, it was determined that she had no estate plan in place. This is a very unusual for someone with a considerable legacy to pass along.
When there is no will or any other documents directing asset transfers, the condition of intestacy is the result. Under the rules of the state of Michigan where she lived, the probate court is required to review the situation and appoint a personal representative to act as the administrator.
Final debts would be paid, and other issues could arise during the process. After everything is in order, the court will close the estate and order the distribution of the assets according to the intestate succession laws. In this situation, these laws would allow for everything to be transferred to the four sons.
That was the way that it stood until Franklin’s niece, Sabrina Owens, found some keys to a locked cabinet while she was cleaning the late artist’s home. In this cabinet, there were two holographic wills that were apparently written back in 2010. A holographic will is a will that was written out by hand.
Owens subsequently came upon a third handwritten will in a notebook from 2014 that was under a couch cushion. One of them required two of the four sons to complete business school before they could be given all of their inheritances. A judge will make the ultimate decision, and it would appear to be quite a jumbled legal mess.
As you can see, if Aretha had developed a relationship with a solid estate planning firm that has a background handling high net worth clients, all this confusion would have been avoided.
She could have explained her objectives and her concerns, and a custom crafted estate plan could have been created to ideally suit her needs. Instead, a judge that cannot get inside her head will have to do the best that he or she can to make an imperfect determination.
There is no reason to take any chances when a licensed estate planning attorney is just a phone call away. If you would like to schedule a consultation, our doors are open. We can be reached by phone at 775-823-9455, and if you would for her to reach out electronically, send us a message through our contact page.
When you see some of the estate planning failures that have been taken by others, you may be motivated to avoid the same mistakes. People sometimes fail to plan ahead for the inevitable because they are under the impression that they are too young to concern themselves with estate planning. While it is obviously true that people in their 30s do not usually pass away, sometimes they do. It is not entirely uncommon for younger people to pass away in motor vehicle accidents. Catastrophic illnesses sometimes strike, and there are those who are the victims of criminal acts.
Longtime NFL quarterback Steve McNair was unfortunately in the latter category. He was killed in 2009 by his mistress when he was just 36, and he left behind a wife and children. He did not have a last will expressing his final wishes. All responsible adults should have an estate plan, but it becomes absolutely essential when you are a married person with children depending on you. You may feel that things automatically fall neatly into place, but this is simply not the case. While Steve McNair did in fact have significant financial resources, his assets were frozen by the probate court because he did not have a will, a trust, or any other estate planning documents in place. His assets were frozen in large part because of his estate tax exposure. He could have taken steps to mitigate this exposure while he was still alive through proper estate planning. The federal estate tax carries a 40% maximum rate so it can certainly play havoc with your financial legacy. Another individual who was victimized by this lack of planning was Steve McNair's mother, Lucille.
McNair was apparently quite grateful to his mother for all the things that she had done for him while he was growing up. During the prime of his career he was a superstar with the Tennessee Titans, and he was in a position to provide his mother with the home of her dreams. He built her a ranch in Mississippi that sat on 45 acres. Lucille looked upon this home as a gift that was given to her by her son. However, the fact is that Steve McNair kept the home in his name. His mother was not the legal owner of the home at the time of his passing. As a result, the home was looked upon as probate property. Steve McNair's widow was named as the personal representative or executor of the estate by the probate court. She demanded $3000 a month rent for the property, and Lucille could not pay so she had to move. It is unlikely that Steve McNair would have wanted to see this outcome. He could have prevented it if he would have taken the time to construct his estate with the assistance of a licensed estate planning attorney.
People who are fortunate enough to enjoy significant financial success are often in a position to create a charitable foundation. When you take this step you can leave behind a profound legacy as your name is associated with philanthropy into perpetuity.
The actor Larry Hagman died at the age of 81 recently, and he will certainly be missed. Though he played a rather unlikable character on the classic television series Dallas, people who knew him say that he was a very nice person who made the world around him a better place.
Individuals who have created artistic works of various kinds leave behind a legacy in the form of their work. Hagman certainly left behind a great deal of his own work, and people will be able to enjoy it for generations to come.
In addition to his legacy as a performing artist Hagman was also an avid philanthropist.
People who start foundations often target causes that are particularly meaningful to them. Hagman greatly valued the creative arts, and indeed, his ability to craft a character before the camera enabled him to enjoy extraordinary financial success.
He gave something back by starting the Larry Hagman Foundation. This foundation assists children in the Dallas-Fort Worth area who have an interest in the creative arts but lack financial support.
Admirers sometimes want to do something in remembrance of a public figure who has passed away. The family of Larry Hagman asks that you make a donation to the Larry Hagman Foundation if you want to pay your respects.
If you are interested in establishing or identifying a foundation that meets your charitable intent, be sure to contact qualified legal counsel to assist you. There are many legal and tax pitfalls that can be avoided with proper advice.