When the rich and famous die, the world mourns their passing. However, that’s not the end of their story. Their estates often make news, not always in a good way. For people who can afford the best estate planners, it’s surprising how many celebrity estates end up in disaster.
Prince Rogers Nelson was only 57 at the time of his death in 2016. Perhaps he thought there was plenty of time left to get around to estate planning. There wasn’t, and Prince not only lacked an estate plan, he didn’t even have a will. That means his estimated $250 million estate is subject to the Minnesota laws of intestate succession. Prince has one full sister and several half-siblings. There are also grandnieces and nephews and purported half-siblings clamoring for a share of his fortune. Most high-net worth individuals have elaborate estate plans, but even a simple will would have prevented this calamity.
Vague wording in Robin Williams’ will caused a legal battle to break out between his children and third wife, Susan. His estimated $100 million estate – including his “personal memorabilia” – was left to his three kids through a trust. The Tiburon, California house he shared with Susan was left to her, with the will also leaving her “the contents thereof.” So, what’s the line between memorabilia and the contents of his home? Within weeks of the actor’s death in 2014, the Williams’ children were removing their father’s personal possessions from the marital home, without their stepmother’s presence. “I had to fight to keep my husband’s slippers,” Susan Williams told People magazine. Although the children and their stepmother eventually reached a settlement, none of this had to happen. Clear language in the estate documents would have clarified exactly what constituted memorabilia.
Tony Soprano would never have left such a messy estate as the actor who played him, James Gandolfini. When Gandolfini dropped dead at age 51 in 2013, his estate was worth an estimated $70 million. Unfortunately, because of poor planning, more than half of it – 55 percent – went to the IRS or state tax coffers. As The Street points out, Gandolfini’s estate was “whacked” by the IRS. His estate planners did virtually nothing to minimize his estate tax bill. Part of the problem was Gandolfini’s choice of heirs. Instead of leaving the estate to his wife – which would have allowed for an unlimited estate tax deduction – he chose to divide it into four percentages, with his wife and daughter getting just 20 percent each and his two sisters receiving 30 percent each. A son from a previous marriage received proceeds of a life insurance policy that is not considered part of the estate. The actor did not take advantage of any trusts that may have lessened the tax bite. Along with the role of Tony Soprano, Gandolfini will be remembered as an example of what not to do in estate planning.
To learn more, contact Attorney Ido Stern at Stern Zwelling today online or by calling 561-609-3556.