Many Floridians have been able to amass considerable assets and properties during their lifetimes. Some of them plan to leave this wealth with their children and want to do so without legal complications that would unnecessarily split the assets, diminish their value or in other ways cost their heirs. To avoid these problems, they must have thorough estate plans in place before they die. Even knowing this basic fact, however, does not preclude many people, including some celebrities who should know better, from costly estate-planning mistakes.
James Gandolfini of “The Sopranos” fame, for example, did not properly plan for taxes; as a result, his family lost an estimated $30 million to state and federal estate taxes. This example illustrates how estate taxes are one area to which every individual should pay special attention when drafting an estate plan.
Beyond estate taxes is the creation and administration of trusts, an area in which both Robin Williams and Philip Seymour Hoffman failed to leave adequate and thorough plans. Williams left his assets in a trust fund for his three children, but when one of the co-trustees died, the trust became public and privacy was breached. Oscar Award winner Hoffman did not want to leave his fortune in a trust where his children would have easy access to large sums of money, so he transferred all assets to their mother, his long-time girlfriend. This forced the estate to go through probate and pay substantial estate taxes. In both cases, a better understanding of estate and trust laws could have helped.
Michael Crichton’s mistake was not keeping his estate plan current. Because he never drafted a comprehensive estate plan, an ex-wife and her children battled his most recent wife and kids over his estate.
These examples of faulty estate planning confirm that avoiding mistakes often means enlisting a professional’s guidance throughout the estate planning process.
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