By: Rachael B. Brekke, JD/MBA
It was recently confirmed that the Queen of Soul did not have a Will or Trust to plan for the distribution of her estimated fortune of $80 million. What unfolds next will be determined by the local probate court in Michigan. So far, four children have stepped forward as potential heirs.
Aretha’s $80 million fortune is likely comprised of song copyrights, past and future royalties, real estate, valuable personal property (like Grammys and gold records!) and a wide variety of investments. Establishing a Trust could have protected each heir’s distribution from divorce proceedings and creditor claims in the future. The sad reality is that estate planning, lifetime gifting, and charitable giving could have reduced the estate taxes significantly. What’s the big deal? After applying the $11.18 million exemption, the federal government will be entitled to 40% of her remaining $69 million!
Beyond estate tax, without clear direction and intent provided by a Will, each heir will undoubtedly hire a lawyer in probate court and litigate issues that could have easily been protected by a Will. Why does this matter? Because the attorneys’ fees will most certainly be requested to be paid by the estate as well!
According to Aretha’s attorney, she was not opposed to writing an estate plan. He recently told the press, “She understood the need. It just didn’t seem to be something she got around to.” Next time you think about your to-do list, cross estate planning off your list by scheduling a consultation with our estate planning attorney Rachael B. Brekke, Esq. at (856) 482-5544