17 Nov
Mistakes in the estate plans of recently deceased celebrities can be useful learning examples for residents of Texas or elsewhere. For example, a living trust is attractive to celebrities and many people because the terms remain private: it does not go through the public probate process at death. However, a seemingly unimportant estate planning mishap can defeat one of its major goals.
Thus, for example, Robin Williams wanted to provide for his three children by setting up an irrevocable living trust, which gave him the added benefit of the terms being private. However, the plan did not say precisely what would happen if a co-trustee passed away. When it actually happened, the surviving trustee was compelled to file a petition to request the court to appoint a successor.
That petition was a public document: it exposed Williams’ trust provisions and assets to public view. Alternate appointments should be made in the legal instrument to avoid such problems. There is a more serious lesson in the case of deceased broadcaster Casey Kasem. His second wife fought with his children from his first marriage for control of his medical decisions.
He had no healthcare directives stating who would have the authority to make medical decisions and act for him in a period of incompetency. Additionally, the parties are now fighting in court over control of his assets. Kasem thus apparently failed to establish living trusts, make a will or to update an old one. In effect, he did not have a working plan that prepared for the potential eventualities.
Phillip Seymour Hoffman had a different mishap: he gave his total estate to the unmarried mother of his three children. This prevented the distribution directly to his children through the use of a living trust, resulting in the estate being hit hard by estate taxes. These types of problems can occur in Texas as well as anywhere else. The solution is to engage in advance planning, to communicate intimately with family members, and to get your estate planning documents executed as early as possible.
Source: recordonline.com, “Bonnie Kraham: Learn from these celebrity estate-planning mishaps“, Bonnie Kraham, Nov. 12, 2014