The absence of an estate plan could make court case messy and expensive.
As time passes following the death of entertainer Prince it appears more and more likely that a will doesn’t exist which will most likely prove to be costly to the estate and costly in the millions of dollars.
The estate is believed to be worth over $100 million and it could be worth much more than that depending on the valuation of his name and likeness rights.
What is clear, as the Daily Signal points out in “Why Over Half of Prince’s Estate Will Go to the Government,” is that combined federal and state estate taxes will take over 50% of the estate’s assets.
Prince’s estate will have to pay the top federal estate tax rate of 40% as well as the Minnesota estate tax of 16%. The other costly consequence of not having an estate plan is that it will lead to numerous claims against the estate. Thus, beyond the amount of taxes the government will take, substantial money will also be lost to fees dealing with those claims.
If Prince had an estate plan, then it is possible the estate tax burden could have been lowered. It is also likely that many claims against his estate would have been less likely to appear.
Drawing upon the knowledge of an estate planning attorney could avoid many of the problems that may arise in settling an estate.
Reference: Daily Signal (April 29, 2016) “Why Over Half of Prince’s Estate Will Go to the Government”
For more information on tax and estate planning, please visit my estate planning website.
