Despite often having significant wealth, over the years many of the rich and famous have made huge estate planning blunders – sometimes including failing to have any estate plan. Unfortunately, Prince seems to be the latest celebrity to pass away without any planning. Although he was reportedly fiercely protective of his music, he was apparently not very diligent when it came to planning his affairs. As discussed in a CNBC article titled, “Prince’s apparent lack of planning may cost his estate”, Prince’s sister Tyka Nelson recently filed court documents seeking the appointment of a special administrator for Prince’s estate stating that she has no knowledge of any will ever created by her brother. If this is true, whoever inherits Prince’s estate will have control over all of his assets including his rumored trove of unpublished music.
There also will most likely be significant taxes owed for Prince’s estate. Estimates are that Prince’s estate is worth about $300 million – not including his unpublished music. With the combination of federal and state taxes, approximately half the value of his estate could go to the government.
There are steps that Prince could have taken to plan his estate including minimizing his taxes. Unfortunately, his lack of planning will result in significant taxes and possibly years of legal disputes amongst his siblings as his surviving heirs.
While the average person has significantly less money than Prince, we can still learn from his mistake in failing to plan. To prevent unnecessary problems for your loved ones, be sure to consult with an experienced attorney.