The estate planning mistakes of some celebrities can teach Pennsylvania retirees some very important lessons. Michael Crichton, Casey Kasem, Phillip Seymour Hoffman and Robin Williams all made some critical errors that could have been avoided. These mistakes affected the privacy of their estate, the amount of money their heirs paid to the government and, in Chrichton's case, the inheritance of one of his children.
Casey Kasem was the subject of a bitter dispute between his wife and an adult daughter from a previous marriage. Though his health care directive named his daughter as his representative, his wife and daughter did not agree on his care. The problem may have been avoided if Kasem had communicated better with his family and made his wishes perfectly clear to everyone involved.
Phillip Seymour Hoffman was not married to the mother of his children when he died. He left his estate to her to disburse to his children instead of setting up trusts for them. Because she was not able to take advantage of the marital deduction, a sizable portion of the money he left went toward estate taxes. Retirees can avoid making this mistake by working with an estate planning professional who understands the IRS rules.
Robin Williams carefully laid out his estate plan. He set up trusts for each of his children to ensure his family's privacy. Unfortunately, one of the trust administrators preceded Williams in death and the co-trustee had to ask the probate court to appoint another one. When the request was filed in court, the documents became public. The lesson here for retirees is to keep estate documents current.
Depending on the size of a person's estate, the process can be complicated. Regular consultation with an estate planning attorney is the best way to ensure that these important documents are up to date.
Source: Forbes, "Lessons Celebrities Can Teach Retirees About Estate Planning", Thomas and Robert Fross , September 16, 2014