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Stuck Between Worlds?

In the non-story of the year, Patrick Swayze died in 2009 at which time he owned real estate in New Mexico.  His widow, Lisa Niemi, recently filed a will to transfer the real estate to their joint trust.  Swayze’s family members believe that the will was possibly forged because they did not receive any of his $40 million estate.  They contend that the signature does not look like his and that he was admitted to the hospital that day before dying two months later.

Several points:

1.  It is rare for someone to include parents and siblings in a will when one has a spouse (and children).  It is also possible that the trust provided for his family members.

2.  It would not be far fetched for his handwriting to become unrecognizable after  suffering from pancreatic cancer for 18 months.

3.  Who knew “Ghost” could be real?  In a turn of events, even without the help of Oda Mae Brown (Whoopi Goldberg), Swayze’s family is channeling the greed of Sam Wheat’s  frenemy, Carl Bruner.

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World’s Greatest Dad?

Robin Williams’ will was admitted to probate court last week.  It provides that his entire $50 million estate will be left to a trust for the benefit of his 3 children.   The trust provides that his children will receive their inheritance in stages at the ages of 21, 25, and 30.

Several points:

1.  Net of estate taxes, each child will $10 million in installments of $3.33 million.

2.  I would never advise a client to leave such a large sum to a 21 or 25 year old – the child’s initiative to become a successful, independent, adult can be stifled.

3.  I recommend more installments with increasing percentages of funds as the child ages.

4.  Williams’ children will likely view their dad as the “World’s Greatest Dad” but I think this trust is a “Flubber.”

 

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News You Can Use – Estate Tax Exemption for 2015

The IRS announced that the estate tax exemption for 2015 will increase from $5.34 million to $5.43 million.  This is the amount that can be left estate tax free to heirs.  Those taxpayers suffering from dyslexia will see little difference.

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Blissful Ignorance?

The will of Andrew Madoff, son of Ponzi schemer Bernie, was admitted to probate court last week.  The will reportedly left his personal property valued at $11.5 million to his 2 daughters.  He left one third of  his $4.5 million of real estate to his estranged wife, and the remaining 2/3 of it  to a trust for his long time girlfriend.   His girlfriend is to receive $50,000 per month for the rest of her life.  Notably, his wife withdrew her 5+ year old divorce filing 6 months ago.  Andrew long maintained he was unaware of his father’s activities even though he worked for his father’s firm.

Many points:

1.  It was smart, if not cynical and financially calculating, of his wife to withdraw her divorce complaint prior to his death because assets pass to a spouse free of federal estate taxes.

2.  I suspect that he also has a funded trust because there is no way to pay his girlfriend $50K monthly for the rest of her life based on a trust with $3 million principal ($2 million after estate taxes).

3.  If there is a funded trust, it behooves the question why these $16 million of assets were not transferred to the trust prior to his death and why the will did not simply pour all assets into the trust and keep these provisions from the public eye.

4.  The karma at work in Bernie Madoff;s life is almost commensurate with the amount of money he stole – reported to the feds by the sons he protected from his scheme, estranged from them afterwards, and now both of them dead before the age of 50 while he is alive in prison at 76.      Almost commensurate.

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To Have and Have Not (a Trust)

The executors of Lauren Bacall’s estate filed her will in probate court on Friday.  Her will, which she executed last fall, left her $27 million estate in equal shares to her 3 children save for a few small five figure bequests to household staff and to her son to care for her dog.    She also left $250K to each of her grandsons to be used for college with them receiving the remainder at the age of 30.

Several points:

1.  A funded trust would have provided her privacy so the public would not know about her intentions.

2.  A trust would also be a more efficient means of managing the funds for her grandsons.

3.  With college tuition increases not grounded in economic reality, I hope the $250K is enough to fully cover college expenses for her grandsons.     lauren Bacall-Lauren_15

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All Posts By Jay Brinker

I am an attorney located in Cincinnati, Ohio who practices in the areas of estate planning, probate, asset protection, and small business advice. I make a difficult and bewildering process as simple as possible. Most importantly, I provide "more for less" for my clients.