An Unfortunate Ending for a Prince without an Estate Plan
Occasionally, a celebrity dies without an estate plan in place. The aftermath typically illuminates the importance of estate planning and provides us with an important lesson. The high-profile entertainer, Prince, died on April 21, 2016. Recently, over six years later, his probate proceedings finally ended.
Prince died without a will or trust in place. With a significant estate valued around $156 million and complex circumstances, the process of distributing the wealth took six years and tens of millions of dollars in legal costs, taxes, and other fees. Here is how an estate plan could have changed this ending.
1. Lengthy Probate Process
From the first filing in April 2016, until closure in August 2022, it took well over six years to bring Prince’s estate to closure through probate. Several factors came into play, including the significant size of his estate and the absence of a will. However, the typical time to complete the probate process is usually twelve to eighteen months depending on the State. If Prince had a will, probate would have been faster than the six years it took in this intestate case. With a fully funded trust-based estate plan, probate would have been avoided altogether.
2. Privacy
Most details of the probate proceedings are public information. In other words, with a little research, anyone can learn the identity of Prince’s beneficiaries as well as his assets and their value. Aside from the loss of privacy, anyone with ill intent can have access to this valuable information. This would be true even if Prince had a will in place because probate is a public process. When using a trust-based estate plan, the inventory of assets and the names of his beneficiaries would not be publicly available. A trust is a private family document and only those in the document have access to the information; it is not public record.
3. Administration Costs and Legal Fees
While this figure is more difficult to determine, the cost of this case is estimated to be well into the tens of millions of dollars. A huge chunk of Prince’s wealth went to perfect strangers—the court-assigned executors, the many attorneys representing their respective clients’ interests during the extended probate process, and more. While administering an estate even with a will or a trust in place has associated administrative costs, the cost of administering this large and intricate estate without the benefit of a will or trust was excessive.
4. Tax Strategy
Estate planning allows for tax planning. With no estate plan in place, there was no tax strategy. The beneficiaries paid a premium in taxes.
5. Administrators, Heirs and Beneficiaries
Without an estate plan, you give up your right to choose your beneficiaries as well as who will administer your estate. You have left these key decisions to the court. It is likely that there were other people in Prince’s life he would have chosen to make gifts to in addition to the half-siblings. Instead, the beneficiaries were determined by state law. In this case, Prince had no spouse or children at the time of his death—usually the first in line for an intestate situation. In addition, the court appointed the executor, which is a significant role that decides how to administer the assets while working with the courts.
Conclusion
A trust-based estate plan protects your chosen beneficiaries from a long and drawn-out probate process and protects their privacy. Utilizing proper estate planning, you can pass along the most wealth possible to the people you want to receive it. Large or small, your estate is important, and these opportunities should not be squandered.
Work with an Experienced Estate Planning Attorney
If you’re ready to get to work on your estate plan no matter what the size, call Wilson Law PLC today at 866-603-5976 to set up a meeting or fill out our contact form and we’ll call you to schedule your meeting.
