What happens if you die without an estate plan?
If you’re the late rock star Prince, you lose half of your estate to state and federal estate taxes. It appears the government will be dancing to Prince’s “1999” all the way to the bank.According to news reports, when Prince died in April of 2016, he had no will and no other estate plan in place. As a result, almost $100 million of his estimated $200 million estate could wind up in the hands of the tax man.
A carefully crafted estate plan may have avoided the multi-million dollar battle over Michael Jackson’s estate currently taking place in the U.S. Tax Court. By disposing of his assets primarily by Will, his estate has been subjected to a myriad of red tape as well as the scrutiny of the Internal Revenue Service. Maybe, as his attorneys have argued, his…
It is not that uncommon for relatively younger children to receive large sums of money and property from their parents’ estate. This may or may not be a good idea in some situations. If both parents or a surviving parent dies, what kind of restrictions should be placed on an inheritance? The question is more acute if a child…
I do a lot of presentations before groups and one of the most common questions I am asked is “How often do I need to update my estate plan?” As with just about any question asked of an attorney, the answer is, “It depends.” It depends on both changes in the law, both federal and state, and it depends on…
In some cases, the home may pass by will to children and other heirs, incurring burdensome estate taxes. In other situations, it may become a source of conflict or become part of a forced sale to settle debts or taxes, and in some cases it may pass uneventfully tax-free to the intended heirs. When transferring a vacation home to your heirs,…
The proceeds of a life insurance policy are included in the insured’s taxable estate at death. If the decedent’s taxable estate exceeds the federal estate exemption (currently $5.45 million), estate tax is due. For some, ownership of a large life insurance policy may trigger estate tax liability at death. An irrevocable life insurance trust can be a useful estate…
After a long and happy life, Grandpa Watkins moves on to the great beyond. He leaves a Last Will and Testament, duly signed and witnessed, in which he expresses his desire to have his assets divided equally among his two sons and two daughters. Unfortunately, several years prior to Grandpa Watkins’ death, his eldest daughter, Lilabeth, was killed in a…
All newlyweds hope for “happily ever after.” Unfortunately, for almost half of Americans who wed, that dream does not reflect reality. Experts say between 40 and 50 percent of all marriages in the United States will end in divorce. Every 10 to 13 seconds someone legally ends their marriage. That means assets accrued before and during marriage may ultimately wind…
Estate planning is a critical necessity when someone is diagnosed with a terminal illness: It is vital that the proverbial “house” be put in order. Timing quickly becomes a concern. At a certain stage in a terminal illness, it may become difficult to ascertain desires, or identify the information required, to carry out effective estate planning. In addition, mental competency,…
Pre-planning protects both parties in a second marriage. Love can be a many-splendored thing, but when it results in a second marriage, careful estate-planning becomes a necessity. Second marriages are a blending process, often of children and assets. Prior to marriage, it is important to discuss your intentions concerning those assets and your heirs. While it is hoped that newlyweds…