Minnesota estate planning and probate tidbits | Several Important Celebrity Estate Planning Lessons

by Flanders Law Firm LLC on August 18, 2014

Minnesota estate planning is no different from estate planning done in other states and for other (famous) people.  We’ve discussed some celebrity estate planning mistakes before, often using the high-profile cases as examples for what others should avoid doing.

Recently, an article appeared in a California newspaper discussing some estate planning lessons learned from the stars. Several cases highlight the problems that occur when there has been a lack of advanced planning and demonstrate how much money, time and energy are wasted by not thinking these kinds of things through while you’re still around. For a quick run down of some of the most important lessons, keep reading

Minnesota estate planning | Probate’s lack of privacyMinnesota estate planning celebrity

A recent sad example of how costly it can be when people fail to create an estate plan is found in the case of Phillip Seymour Hoffman. Hoffman died with a will, though one that had not been updated in several years. Though a will may seem like a great first step, and it is, it doesn’t go nearly far enough to properly manage the large estate left behind by Hoffman. Given his public profile and the lack of privacy that exists in probate court, the world now knows every last detail of his last wishes and the exact amount of money he left behind.

Had Hoffman instead taken the time to create a trust fund, none of the information that is currently splashed across the front pages of tabloids would have been available. Unfortunately, Hoffman was so concerned with avoiding leaving behind “trust-fund kids” that he failed to take advantage of what could have been a great way to shield his family from incredible press scrutiny.

Though few of us will ever experience the kind of media attention that celebrities endure on a daily basis, that doesn’t mean we are eager to have our personal financial information disclosed to anyone willing to dig around. The downside with going through the probate process is that everything that happens in court becomes part of the public record and can be accessed by virtually anyone. A bit of planning can avoid this and shield your most personal information from public view.

Minnesota estate planning | The taxman cometh

James Gandolfini’s death was a surprise to many given his young age. Though Gandolfini had taken the time to create a will, he too never got around to drawing up a trust or other, more sophisticated method of protecting his assets. We now know, thanks to the public records from his probate hearings, that the Sopranos star left behind an estate worth around $70 million. Unfortunately, the estate, which was left to a sister and his young child, must now fork over tens of millions of dollars in taxes and he failed to avoid probate.

Had Gandolfini simply planned ahead, he would have been able to give millions more to his loved ones or, if they already had plenty, to charities. Instead, experts say the federal government will now walk away with around $30 million, drastically reducing the size of his estate.

Minnesota estate planning | Thinking ahead can saves billions

In contrast to Gandolfini, Steve Jobs was a man with a meticulous end-of-life plan. Suffering from pancreatic cancer for years gave the billionaire time to get his estate plan in perfect order and most experts say he did a masterful job. The Apple guru left behind an estate worth more than $7 billion, but thanks to the use of living trusts and charitable gifts, will pay little if any money in estate taxes. That means more money for his family and more money for the charities near and dear to his heart. Additionally, none of the details of how much money was left to who have been revealed. The reason? Everything was handled with trusts and the information is and will remain private.

Minnesota estate planning | Benefits of dividing responsibilities

Finally, the case of Paul Walker provides a good example of how it may not always be the best idea to leave all your assets to one person. In Walker’s case, the movie star chose to divide some important responsibilities between his mother and his daughter’s mother. Though he left his millions in trust for his young child, Walker chose not to leave the girl’s mother as caretaker of that money. Though there doesn’t appear to have been any bad blood between the two, experts say the decision was simply meant to ensure that there were checks and balances. Walker chose his mother as the caretaker of the money, allowing her to ensure that the money was being used as it ought to, freeing up his wife to simply love and nurture the young girl.

An experienced Minnesota estate planning lawyer can help walk you through the complicated process of establishing a workable estate plan. For more information on estate planning in Minnesota, along with a variety of other topics, contact Joseph M. Flanders of Flanders Law Firm at (612) 424-0398.
Source: “Liza Horvath, Senior Advocate: Estate planning of the stars,” published at MontereyHerald.com.

 

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